• Gold prices eased from a one-week high, but still remained up on Wednesday, as the U.S. dollar dipped versus the yen and share markets faltered after China retaliated against a U.S. move to slap tariffs on $50 billion worth of its imports.
• Beijing said after Chinese markets had closed that it would impose additional tariffs on $50 billion worth of U.S. imports ranging from cars, chemicals and corn to whisky and tobacco, initially raising trade-war jitters.
• China on Wednesday proposed tariffs on U.S. imports including soybeans, planes, cars, beef and chemicals. The Chinese plan came hours after Washington unveiled a detailed breakdown of some 1,300Chinese industrial, transport and medical goods that could be subject to 25 percent duties.
• Spot gold was up 0.2 percent at $1,335.66 per ounce by 1:33 p.m. EDT (1733 GMT), while U.S. gold futures futures for June delivery settled up $2.90, or 0.2 percent, at $1,340.20.
• Retaliation from China, the world’s largest gold consumer, earlier propelled spot gold prices to a one-week high at $1,348.06 per ounce as the U.S. dollar tumbled against the yen and equities dipped.
• A lower appetite for risky investments took some strength from the dollar, which made dollar-priced gold cheaper for holders of non-U.S. currencies. It also tends to make gold more appealing as a safe-haven asset during times of economic or geopolitical uncertainty.
But as Wall Street and European stocks pulled back from declines of more than 1 percent and the dollar pared losses, gold shed some of its gains.
• “Gold worked for the hedgers today, as expected. When stocks were off over 500 points, gold was up over $1,350. As stocks pared losses, (gold) gave back gains,” said George Gero, managing director of RBC Wealth Management.
• Also capping gold’s upside were signs of still-steady global economic growth.
• “Political (trade war) factors are offsetting the negative factors (for gold) of a generally improving U.S. and global economy. We think gold is heading upwards largely because we have a weaker dollar view, but we think the range is going to hold for a while,” said Matthew Turner, commodities strategist at Macquarie.
• Investors are looking ahead to U.S. nonfarm payrolls on Friday, with stronger-than-expected data a risk for gold as it will likely support the dollar and calm fears over growth, even in the face of a potential trade war, analysts said.
• Meanwhile, spot silver fell 0.6 percent to $16.27 per ounce, after dipping to a six-day low of $16.23.
• Platinum dropped 0.9 percent to $915.50 an ounce, earlier falling to $908, its lowest level since December.
• Palladium lost 0.7 percent to $922.70 an ounce after touching $913, its lowest price since October.
Reference: Reuters
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