3 Min Read
BENGALURU (Reuters) - Gold edged higher on Tuesday, supported by a ballistic missile test by North Korea and an easing dollar, but was still sitting near seven-week lows hit in the previous session.
North Korea test-launched a ballistic missile from its western region into the sea off its east coast on Tuesday, South Korea's military said, ahead of a summit of leaders from the Group of 20 nations in Germany later this week.
"The North Korean missile launches are becoming second nature and the market look through them, but some jitters remain on escalation," said Stephen Innes, head of trading APAC, OANDA in Singapore.
"(Though) not necessarily a strong buy gold signal, it has stopped the fall," he added.
Spot gold rose 0.2 percent to $1,223.08 per ounce at 0417 GMT. On Monday, it fell 1.7 percent, its biggest one-day percentage loss since November, to touch a low of $1,218.31 an ounce, its weakest since May 11.
U.S. gold futures for August delivery rose 0.3 percent to $1,222.30 an ounce.
Potential for any sort of disagreement on trade, investment, and security between U.S. President Donald Trump and other European leaders is also providing some geo-political support for gold, NAB analyst John Sharma said.
Trump discussed hot-button issues like climate change, trade and migration in calls with German and Italian leaders on Monday, before a summit this week of the G20 leading economies that could expose sharp policy differences.
Expectations of higher bond yields are also weighing on non-yielding bullion keeping it range-bound, Sharma added.
U.S. Treasury yields rose on Monday after U.S. manufacturing data boosted expectations that the Federal Reserve would raise interest rates again this year as other central banks shift toward tighter monetary policy.
Meanwhile, the dollar index against a basket of six major currencies slipped 0.1 pct to 96.108.
Among other precious metals, silver was down 0.1 percent at $16.10 after touching a low of $16.01, its weakest since May 9.
"More investors are coming aboard at the current relatively low entry level for silver and physical demand has been robust both in Singapore and in Hong Kong," said Joshua Rotbart, managing partner, J. Rotbart & Co in Hong Kong.
"However, we did execute very large liquidations of silver holdings by clients who held these for 4-5 years, and have given up on waiting for the price to get back to its heydays level," he added.
Platinum rose 0.5 percent to $906.20 after falling below $900 for the first time since May 10 on Monday.
Palladium rose 1.5 percent to $855.73 an ounce.
U.S. markets will be shut on Tuesday for the Independence Day holiday.
Reporting by Vijaykumar Vedala and Koustav Samanta in Bengaluru; Editing by Richard Pullin