Gold dips to two-week low as dollar gains ahead of Powell speech
By K. Sathya Narayanan BENGALURU (Reuters) - Gold fell to a two-week low on Wednesday as the dollar gained on interest from investors seeking refuge from trade tensions while they awaited clues on further U.S
By K. Sathya Narayanan
BENGALURU (Reuters) - Gold fell to a two-week low on Wednesday as the dollar gained on interest from investors seeking refuge from trade tensions while they awaited clues on further U.S. rate hikes from Federal Reserve Chairman Jerome Powell.
Spot gold inched 0.2 percent lower to $1,211.36 per ounce at 09:56 a.m. EST (1456 GMT). It fell to its lowest level since Nov. 15 at $1,210.65 earlier in the session.
U.S. gold futures also shed 0.2 percent to $1,211.30.
"U.S. dollar continues to be a safe haven here. ... There is (also) ambiguity about the Fed policy," said Bart Melek, head of commodity strategies at TD Securities.
Gold's momentum at the moment is being dictated more by the dollar and developments surrounding interest rates rather than the G20 meeting later this week, Melek said.
Powell is due to speak before the Economic Club of New York Signature Luncheon later on Wednesday.
Investors will also keep a close watch for the minutes from the central bank's Nov. 7-8 meeting, scheduled to be released on Thursday, for indications on the rate hike trajectory in 2019. [FED/DIARY]
The Fed has raised rates three times this year and a fourth increase is expected in December, making non-yielding bullion less attractive.
Meanwhile, the greenback held near a two-week high against a basket of major currencies, denting gold's appeal, as investors flocked to the U.S. currency on concerns over the outcome of the G20 summit in Argentina this week.
U.S. President Donald Trump is likely to meet his Chinese counterpart on the sidelines of the summit to discuss the trade dispute between the major economies.
Bullion has largely lost out to the dollar as a safe haven asset this year as the U.S.-China trade war unfolded against a backdrop of rising U.S. interest rates.
On the technical front, the yellow metal hovered just above the 100-day moving average of around $1,210.
"Gold should stay fairly range-bound in the short term. I struggle to see it breaking below $1,200 and likewise on the upside, until the end of this year, I struggle to see it breaking above $1,250 as well," ING analyst Warren Patterson said.
Among other precious metals, silver slid 0.4 percent to $14.09 per ounce, while platinum fell 1.2 percent to $820.30, having earlier touched its lowest in more than a month, at $814.50. Palladium rose more than 2 percent to $1,174.00 per ounce, having earlier jumped to its highest in one week, at $1,182, just shy of an all-time high of $1,185.40 hit earlier this month.
"The market remains very tight. ... Potential growth for supply is very limited and demand remains robust even though we've seen a decline in auto sales in China and a slowdown in car sales in the U.S.," said Suki Cooper, precious metals analyst at Standard Chartered Bank.
(Reporting by K. Sathya Narayanan, Arpan Varghese and Swati Verma in Bengaluru; Editing by Will Dunham)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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