May 28, 2018 / 3:21 AM / 25 days ago

PRECIOUS-Gold dips on revived hopes of U.S.-N.Korea summit

    * Trump says U.S. team in N.Korea to prepare for proposed
summit
    * Specs cut net long position in COMEX gold to 10-month low

 (Adds details, updates prices)
    By Swati Verma
    BENGALURU, May 28 (Reuters) - Gold prices fell for a second
straight session on Monday as political tensions eased after
U.S. President Donald Trump revived hopes of a U.S.-North Korea
summit.
    Spot gold        declined 0.4 percent to $1,296.20 per ounce
at 0700 GMT, while U.S. gold futures         for June delivery
fell 0.6 percent to $1,295.60 per ounce.
    "It looks like there is some chance of a meeting between the
U.S. and North Korea leaders, that would lower the geopolitical
risks and lessen the appeal of gold," said John Sharma, an
economist with National Australia Bank, adding that a strong
dollar was also pressuring prices.
    The dollar index       , which measures the greenback
against a basket of six major currencies, stood at 93.961, not
far from 94.298 hit on Friday, its highest since Nov. 14.
    Trump on Thursday called off a planned summit with North
Korean leader Kim Jong Un, which lifted gold above $1,300 an
ounce level. The yellow metal gained about 0.7 percent last
week, in its biggest weekly gain since the week ended April 13.
    However, Trump on Sunday said that a U.S. team had arrived
in North Korea to prepare for the summit between him and Kim
Jong Un.             
    "Risk sentiment has opened in a much friendly place this
morning as a relief rally has ensued with the Trump-Kim summit
back on, while the EU is in the midst of a relief rally after
Paolo Savona was not endorsed for finance minister in Italy,"
said Stephen Innes, APAC trading head at OANDA.
    Efforts to form a coalition government in Italy collapsed on
Sunday after its president rejected a eurosceptic pick for the
key economy ministry, triggering a possible constitutional
crisis and opening the prospect of fresh elections.             
    Meanwhile, holdings of SPDR Gold Trust      , the world's
largest gold-backed exchange-traded fund, fell 0.42 percent to
848.50 tonnes on Friday.          
    Speculators trimmed their net long position in COMEX gold by
3,800 contracts to 27,527 contracts in the week to May 22, U.S.
Commodity Futures Trading Commission (CFTC) data showed on
Friday. This was the smallest position since July 2017.        
    Silver speculators cut net short position by 15,620
contracts to 432 contracts, according to the data. This was the
smallest position since February 2014.
    Spot silver        was down 0.1 percent at $16.47 per ounce.
    Platinum        gained 0.8 percent to $903.70 per ounce,
while palladium        was up 0.2 percent at $981.50.
    Trading volumes are expected to be low as the New York and
London markets are closed on Monday for public holidays.

 (Reporting by Swati Verma in Bengaluru
Editing by Joseph Radford and Subhranshu Sahu)
  
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