By Brijesh Patel
(Reuters) - Gold was little changed on Tuesday, hovering near the two-week peak hit in the previous session on global growth concerns, though further talks in the U.S.-China trade dispute could yet dent appeal for the safe-haven metal.
U.S. gold futures
Concerns over global growth plus the added spice of geopolitical risk that has emerged again in the Middle East is supporting gold, said Saxo Bank commodity strategist Ole Hansen.
"The underlying demand for gold is still there. In terms of a trigger, the market will continue to keep an eye on developments in oil markets from the geopolitical perspective."
Concerns over the global economy have continued to mount of late, with a survey out of the Euro zone on Monday showing business growth stalled this month while mixed economic readings out the United States added to caution over the prolonged U.S.-China trade war.
"Fears of recession are growing in the Eurozone because the weakness in industry now also appears to be spilling over into the services sector," Commerzbank analysts wrote in a note.
"Gold was therefore in considerable demand as a safe haven yesterday, as reflected in high ETF (exchange-traded fund) inflows."
Holdings of SPDR Gold Trust GLD, the world's largest gold-backed ETF, jumped 1.6% to 908.52 tonnes on Monday, the highest since November 2016.
Meanwhile, tensions in the Middle East have escalated since an attack on Saudi Arabia's oil facilities this month, with Britain, Germany and France joining the United States in blaming Iran for the attacks. Iran has denied all such allegations.
A less bullish factor for gold is the potential for progress in resolving the U.S.-China dispute after U.S. Treasury Secretary Steven Mnuchin told the Fox Business Network that discussions with China are scheduled to take place in two weeks.
On the technical front, spot gold could consolidate in a range of $1,489 to $1,566 in the next quarter, as suggested by its wave pattern and a projection analysis, said Reuters technical analyst Wang Tao.
Among other precious metals, palladium
(Reporting by Brijesh Patel in Bengaluru; Editing by David Goodman)
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Updated Date: Sep 25, 2019 02:06:36 IST