March 7, 2018 / 4:07 AM / 9 months ago

PRECIOUS-Gold comes off 1-week high as trade war fears weigh on dollar, equities

    * U.S. dollar, stocks down after Trump economic advisor
    * Gold hits 1-wk high, climbing up from 2-mth lows last week
    * Spot gold        may fall to $1,327/oz - technicals
    * Palladium falls to lowest in nearly one month 

 (Updates prices)
    By Nithin ThomasPrasad
    March 7 (Reuters) - Gold prices slipped on Wednesday after
hitting a one-week high earlier as the dollar weakened and
equities dropped after U.S. President Donald Trump said he would
push ahead with punitive tariffs on imports, rekindling fears of
a potential trade war.
    Spot gold        was down 0.1 percent at $1,333.15 per ounce
as of 0747 GMT, after touching $1,340.42, its highest since Feb.
26, earlier in the session. 
    U.S. gold futures         for April delivery fell 0.07
percent to $1,334.20 per ounce.
    "Volatility in risk assets, and concerns around the
implications of Trump's tariff rhetoric has helped propel gold
higher," said Jordan Eliseo, chief economist at gold trader ABC
     Global stocks and the dollar fell after a key advocate for
free trade and Trump's top economic adviser, Gary Cohn, resigned
after the president said he was sticking with plans to impose
tariffs on imports, which some critics have dubbed the first
shot in a global trade war.                               
    Last Thursday, Trump had said a plan for tariffs of 25
percent on steel imports and 10 percent on aluminium products
would be formally announced this week. 
     Traders fear the departure of Cohn, a former Wall Street
banker, would embolden protectionist forces in the U.S.
administration as Trump tries to impose hefty tariffs. 
    "Prices will remain firmly supported ... from Cohn's
departure as the tariff gambit hits the market again with blunt
force," said Stephen Innes, APAC trading head at OANDA. 
    Cohn's resignation also offsets pressure from recovering
risk appetites that followed Tuesday's news of North and South
Korea holding their first summit in over a decade, and that came
after the South said the North expressed willingness to discuss
denuclearization with the United States.              
    Gold is used as an alternative investment during times of
political and financial uncertainty, and a weaker dollar makes
the metal cheaper for holders of other currencies. 
    Spot gold        may fall to $1,327 per ounce following its
failure to break above $1,342, according to Reuters technical
analyst Wang Tao.         
    Meanwhile, Asian gold-backed exchange-traded funds (ETFs)
added more tonnes in February than North America or Europe,
reversing Asia's 2017 trend of having more flows out, the World
Gold Council said on Tuesday              
    In other precious metals, silver        fell 0.2 percent to
$16.70 per ounce, after hitting its highest in more than two
weeks. Platinum        dipped 0.9 percent to $959.74 per ounce.
    Palladium        declined 1.2 percent to $973.72 per ounce.
It hit $971 an ounce, its lowest since Feb. 9, earlier in the

 (Reporting by Nithin Prasad in Bengaluru; Editing by Tom Hogue
and Subhranshu Sahu)
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