Tag Archives: china trade war

PRECIOUS-Gold rises as dollar backs off highs after Fed meeting minutes | Reuters

25 Friday May 2018

Posted by in gold, precious metal market, scrap gold, scrap precious metals

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Gold nugget

By Renita D. Young and Zandi Shabalala

NEW YORK/LONDON, May 23 (Reuters) – Gold prices rose on
Wednesday as the U.S. dollar backed off its highs against a
basket of currencies while investors interpreted minutes from
the U.S. Federal Reserve’s latest policy meeting as dovish.
Most Federal Reserve policymakers thought it likely another
interest rate increase would be warranted “soon” if the U.S.
economic outlook remains intact, minutes of the central bank’s
last policy meeting showed.
Higher interest rates make non interest-bearing assets like
gold less attractive.

However sentiment was dovish, said Bob Haberkorn, senior
market strategist at RJO Futures. “They’re backing off the
inflation target at 2 percent. Just them saying that signals
that [the Fed is] dovish on rates and it doesn’t sound very
aggressive. That should be supportive for metals.”
Policymakers once again debated the inflation path. Several
noted that recent wage data provided “little evidence” of
overheating in the labor market, while some others saw a risk
that “supply constraints would intensify upward wage and price
pressures, or that financial imbalances could emerge.”
Spot gold gained 0.3 percent at $1,294.19 per ounce
by 2:35 p.m. EDT (1835 GMT), after touching its highest since
May 15 at $1,297.84. U.S. gold futures for June delivery
settled down $2.40, or 0.2 percent, at $1,289.60 per ounce.
The dollar, in which gold and other commodities are priced,
rose versus a basket of currencies but came off its
highs.

Often used to store wealth in times of political or economic
uncertainty, gold was underpinned by safe-haven support after
U.S. President Donald Trump said he was not pleased about recent
talks with China.

Gold also saw some safe-haven support after President Sergio
Mattarella gave political novice Giuseppe Conte a mandate to
lead the first government in Italy made up of anti-establishment
parties that have vowed to shake up the European Union,
Haberkorn added.

Trump also cited a “substantial chance” his summit with
North Korean leader Kim Jong Un will not take place as planned
on June 12 amid concerns that Kim is resistant to giving up his
nuclear weapons.

Gold has shown reduced volatility in the last few trading
sessions as it attempted a break above $1,300 and prices are
“waiting for a new, clear direction,” said ActivTrades chief
analyst Carlo Alberto De Casa.

Silver fell 0.4 percent at $16.45 an ounce and
platinum was 0.2 percent lower at $904.30 an ounce.
Palladium eased 1.2 percent to $979.10 an ounce.

via PRECIOUS-Gold rises as dollar backs off highs after Fed meeting minutes | Reuters

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PRECIOUS-Gold hits 5-month low as U.S. trade war with China ‘on hold’ | Reuters

22 Tuesday May 2018

Posted by in market, precious metal market, scrap gold, scrap precious metals

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* Dollalandis refining, dental industryr index climbs to five-month high

* China, U.S. have great potential for cooperation- Chinese state
media
* Specs cut net long position in gold in week to May 15

By Apeksha Nair
BENGALURU, May 21 (Reuters) – Gold slid to a near five-month
low on Monday, as the dollar rose and demand for safe-haven
assets eased after U.S. Treasury Secretary Steven Mnuchin said a
trade war between China and the United States was “on hold”.
Spot gold was down 0.6 percent at $1,283.30 per ounce
at 0658 GMT, after earlier hitting $1,281.76, its lowest since
Dec. 27.
U.S. gold futures for June delivery were 0.7 percent
lower at $1,282.50.
“Gold price is under pressure as the dollar maintains its
strength,” said Naeem Aslam, chief markets analyst at Think
Markets.
“‘On Hold’ is a risk-on term…The absence of trade tariffs
and hostile tone between the two countries has also impacted the
gold price more adversely,” Aslam said.
The dollar rose versus the yen and hit a five month-high
against a basket of currencies, after Mnuchin’s comments
downplaying a trade dispute with China, boosting risk sentiment
amid hopes for an easing of trade tensions between the world’s
two biggest economies.
Chinese state media on Monday praised a significant dialing
back of trade tension with the U.S., saying China had stood its
ground and the two countries had huge potential for win-win
business cooperation.
“You have this combination of technical factors which is at
the moment un-supportive (for gold). As long as the dollar is on
the firm side, gold is under pressure,” said Dominic Schnider at
UBS Wealth Management in Hong Kong.
The price of gold fell below the psychologically important
$1,300 per ounce level last week for the first time since late
December and has since continued to trade below its 200-day
moving average.
A stronger dollar makes dollar-denominated gold more
expensive for holders using other currencies. Furthermore,
rising U.S. interest rates, and the expectation that U.S.
Federal Reserve will raise rates again next month, limits
investor demand for non-yielding bullion.
“Investors are looking towards the biggest event of this
week- the FOMC minutes and if the Fed doesn’t tame its hawkish
stance, we would expect more weakness in the gold price,” Aslam
said.
Hedge funds and money managers cut their net long position
in COMEX gold contracts by 21,294 contracts to 31,327 in the
week to May 15, data showed on Friday.
In other precious metals, silver fell 0.8 percent to
$16.30 an ounce.
Platinum was 0.4 percent lower at $879 an ounce,
after marking an over five-month low at $874 earlier.
Palladium rose 0.5 percent at $968.30 per ounce,
after hitting a two-week low at $960.22 on Friday.

via PRECIOUS-Gold hits 5-month low as U.S. trade war with China ‘on hold’ | Reuters

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