November 12, 2019 / 4:32 AM / 2 months ago

PRECIOUS-Gold edges down as market turns optimistic on trade negotiations

* Trump to speak at the Economic Club of New York later in the day

* Spot gold to be in range of $1,417-$1,440/oz - technical analyst (Recasts, adds comments; updates prices)

By Diptendu Lahiri

Nov 12 (Reuters) - Gold edged down on Tuesday, ahead of U.S. President Donald Trump’s speech at the Economic Club of New York with investors hoping for positive commentary around China trade talks.

Spot gold fell 0.3% to $1,451.89 per ounce at 0712 GMT, while U.S. gold futures were down 0.4% at $1,451.40 per ounce.

“Investors are expecting constructive news from Trump after he said trade talks with China were moving along very nicely and as the time for the speech is approaching closer it is impacting gold negatively,” said Argonaut Securities analyst Helen Lau.

Trump’s lunchtime address at the club will be closely watched by investors anxious for any positive news about his administration’s long-running trade war with China.

Further weighing on the non-yielding bullion, Asian share markets edged higher as investors await the address by Trump, while a slightly higher dollar index against rival currencies also played its part.

The months-long trade dispute has roiled financial markets and sparked fears of a global economic slowdown, pushing the precious metal, which is considered a safe asset in times of political and economic uncertainty, more than 13% higher this year.

The United States and China had agreed to roll back tariffs on each others’ goods as part of the first phase of a trade deal, but Trump denied any such agreement over the weekend.

“New developments in the U.S.-China trade war or any data that point towards inflation rate element will impact gold prices,” said Nicholas Frappell, global general manager at ABC Bullion.

Last week Chicago Federal Reserve President Charles Evans said that the U.S. economy is in a good place but the path of inflation will be important in deciding the future path of interest rates.

Spot gold may break a support at $1,455 per ounce and fall into the range of $1,417-$1,440, according to Wang Tao, Reuters market analyst for commodities and energy technicals.

Meanwhile, in Hong Kong police shot and critically wounded a protester and a man was set on fire on Monday in violence that prompted leader Carrie Lam to denounce “enemies of the people” and drew a chilling warning from a senior Chinese newspaper editor.

The events were an escalation in pro-democracy unrest in the Chinese-ruled territory that has lasted five months.

Elsewhere, palladium inched up 0.5% to $1,696.07 per ounce, having touched its lowest since Oct. 10 in the previous session.

Platinum edged up 0.4% to $879.15 per ounce, while silver fell 0.2% to $16.83 per ounce. (Reporting by Diptendu Lahiri in Bengaluru; Editing by Aditya Soni, Sherry Jacob-Phillips and Shailesh Kuber)

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