Gold gains on weaker dollar, U.S.-China tensions
· Gold rose to a more than one-week high on Monday as the dollar weakened and jitters over rising tensions between Washington and Beijing, as well as protests in U.S. cities, boosted demand for the metal as a haven from risk.
· Spot gold was up 0.5% to $1,735.57 per ounce by 1248 GMT, while U.S. gold futures settle down $1.4 to $1,750.30.
· “Higher tensions between China and the U.S. are bringing safe-haven buying. Tensions within the U.S. are not helping the cause, while the dollar is pretty much on its lows,” said Afshin Nabavi, senior vice president at precious metals trader MKS SA.
· The dollar fell to its lowest since mid-March, making gold less expensive for holders of other currencies.
· China’s state media and the Hong Kong government lashed out on Sunday at U.S. President Donald Trump’s pledge to end Hong Kong’s special status if Beijing imposes new national security laws on the city.
Meanwhile, protests broke out across many U.S. cities after an unarmed black man died in police custody last week. The closely packed crowds have sparked fears of an increasing number of coronavirus infections.
· Gold is seen as a safe-haven asset during times of political and economic uncertainty.
· Earlier in the session gold rose as much as 1% to its highest in more than a week, but it has since pared gains as global equities jumped due to easing lockdowns.
· Gains in stock markets have triggered some profit-taking in the gold price, said Ajay Kedia, director at Kedia Commodities in Mumbai.
“We have seen a sharp rally in silver prices. That clearly shows that people are moving out of gold and targeting silver,” Kedia added.
· Silver rose 2% to $18.20 per ounce, having earlier touched its highest since Feb. 25.
· Palladium fell 0.8% to $1,929.95 per ounce, and platinum eased 0.3%, to $835.68.
Reference: Reuters
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