Gold dips on firm dollar and rise in risk appetite

By Eileen Soreng (Reuters) - Gold slipped to its lowest in almost a month on Monday as a firm dollar and greater risk appetite outweighed support from an expected pause to increases in U.S. interest rates. Spot gold was 0.1 percent down at $1,280.26 an ounce by 11:42 a.m

Reuters January 22, 2019 00:06:21 IST
Gold dips on firm dollar and rise in risk appetite

Gold dips on firm dollar and rise in risk appetite

By Eileen Soreng

(Reuters) - Gold slipped to its lowest in almost a month on Monday as a firm dollar and greater risk appetite outweighed support from an expected pause to increases in U.S. interest rates.

Spot gold was 0.1 percent down at $1,280.26 an ounce by 11:42 a.m. ET (1642 GMT), having touched its lowest since Dec. 28 at $1,276.31. U.S. gold futures were down 0.2 percent to $1,279.90.

"Some calm has been restored in the equities market ... We are seeing a bit of withdrawal of interest from the gold market," said Macquarie commodity strategist Matthew Turner.

World markets showed some relief from Chinese economic data in line with expectations and offered some bright spots, though concerns about British Prime Minister Theresa May's Brexit plans prompted some caution. [MKTS/GLOB]

U.S. markets were closed on Monday for a public holiday.

The dollar rise to a near two-week high weighed on gold, which has climbed more than 10 percent since mid-August, largely because of equity market turmoil and a weak dollar. [USD/]

ActivTrades chief analyst Carlo Alberto De Casa said a break through $1,277 could lead the gold price down to $1,260.

Analysts said gold was still finding some support from expectations that the U.S. Federal Reserve had reached the end of its monetary tightening, a slowdown in global economic conditions and geopolitical uncertainties.

Fed officials have left little doubt that they want to stop raising interest rates, at least for a while, before their first meeting of the new year over Jan. 29-30.

Higher rates tend to reduce appetite for non-yielding gold.

Holdings of SPDR Gold, the largest gold-based exchange-traded fund, rose 1.5 percent on Friday to 809.76 tonnes. [GOL/ETF]

Meanwhile, spot palladium, which hit a record high of $1,434.50 last week, driven by a sustained deficit, shed 1.4 percent to $1,357.50 an ounce.

"As a result of the strong rally over the last couple of months, the palladium market may see some consolidation before resuming its upward path," said Hans-Guenter Ritter, Global Head of Trading at Heraeus Metals, Germany.

Silver fell 0.2 percent to $15.29 an ounce while platinum lost 0.7 percent to $791.78.

(Reporting by Eileen Soreng in Bengaluru; Editing by David Goodman and Nick Zieminski)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.