• Spot gold dipped on Thursday as the U.S. dollar pared losses on safe-haven buying from investors fearing a trade war between the United States and China, but gold futures rose, with one trader citing arbitrage trades.
• U.S. President Donald Trump initiated trade action against China, saying the U.S. deficit with Beijing was "out of control" at about $504 billion and there was a huge "intellectual property theft situation."
• Spot gold dipped 0.3 percent at $1,328.21 per ounce by 2:28 p.m. EDT (1828 GMT).
U.S. gold futures for April delivery settled up $5.90, or 0.5 percent, at $1,327.40 per ounce. One trader said investors were rolling from the expiring contract of April into the new front month, which is June.
• The U.S. dollar index bounced from a month low versus a currency basket. A stronger greenback makes dollar-priced gold costlier for holders of other currencies.
• "We have another rush to cash so you see crude, copper also being sold as markets weaken all around," said George Gero, managing director at RBC Wealth Management.
• Some market participants still expect a rebound in gold prices.
• "I know gold is down a little bit right now, but I wouldn't be surprised to see it reversed," said Chris Gaffney, president of world markets at EverBank.
• Gold will likely trade within a tight range near term, traders have said, citing conflicting signals between support for bullion from geopolitical worries and pressure from strength in the U.S. economy.
• "We expect the prospect of a trade war between the U.S. and other economies to put a floor under gold prices in the short term but ultimately we think that Fed tightening will prove too strong a headwind," Capital Economics analyst Simona Gambarini told the Reuters Global Metals Forum.
• Meanwhile, spot silver dropped 0.7 percent at $16.41 per ounce, while platinum fell 0.5 percent at $949.40, earlier seeing a 1-week high of $963.60.
Palladium fell 0.8 percent at $982.45 per ounce, earlier hitting a 1-1/2-week low at $967.
Reference: Reuters
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