· Gold prices fell to a near four-month low on Tuesday as the dollar gained and investors preferred riskier assets, dampening the safe-haven metal’s appeal.
· Spot gold was down 0.6 percent at $1,266.98 per ounce, after falling to its lowest since Dec. 26 at $1,265.90.
· U.S. gold futures fell 0.7 percent to $1,268.70 an ounce.
· “Gold traders are on the sidelines because of the strength in the dollar, stock and bond markets,” said George Gero, managing director at RBC Wealth Management.
“Gold (market) is taking a back seat, waiting for something solid like inflation numbers or some political changes in the U.S.; until then, prices are expected to trade in the lower ranges.”
· Denting appeal for bullion, the dollar index held near a three-week high as a drop in market volatility boosted demand for riskier assets, with higher U.S. bond yields also offering support to the U.S. currency.
Also, U.S. stocks were trading higher on better-than-expected corporate results.
· “There is risk-on sentiment, and no flight to safety now, even with what happened in Sri Lanka,” said Phillip Streible, senior commodities strategist at RJO Futures.
· Attacks on churches and luxury hotels in Sri Lanka on Sunday killed over 300 people and wounded more than 500.
· Adding to gold’s headwinds are better-than-expected economic readings recently from both the U.S. and China, contributing to the metal’s decline of about 6 percent from its 2019 peak touched in February.
· Markets are now awaiting the release of U.S. GDP data later in the week for indications about the strength of the world’s largest economy.
· Analysts and traders said gold’s break below key support levels last week, including the 100- and 50-day moving averages, signalled further downside for prices.
· Indicative of sentiment, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, were at their lowest since Oct. 26.
· In other metals, silver fell 1.5 percent to $14.76 per ounce. Platinum was down 0.9 percent, to $887.46 per ounce, having hit a two-week high of $911.75 in the previous session.
Palladium fell 0.4 percent to $1,381.02 per ounce, after falling as much as 3.5 percent in the previous session.
Reference: CNBC
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