May 22, 2018 / 3:32 AM / 3 months ago

PRECIOUS-Gold prices slip as investors eye riskier assets

    * Easing geopolitical risk negative for gold - analyst
    * SPDR gold holdings down 0.4 pct on Monday
    * Platinum edges up from five-month low hit on Monday

 (Updates prices)
    By Apeksha Nair
    BENGALURU, May 22 (Reuters) - Gold prices dipped slightly on
Tuesday, hovering not far off a 2018 low struck in the previous
session as a firm dollar near five-month highs and optimism in
global markets curbed appetite for the precious metal.
    Spot gold        was down 0.2 percent at $1,290 per ounce,
as of 0614 GMT. In the previous session, it slid to $1,281.76,
its lowest since Dec. 27.
    U.S. gold futures         for June delivery slipped 0.1
percent to $1289.8 per ounce.
    "I think the overriding narrative here is where the dollar
is going," said Stephen Innes, APAC trading head at OANDA.
Abating geo-political risk was also weighing on sentiment for
gold, he added.  
    The dollar traded below a five-month high against a basket
of currencies on Tuesday, catching its breath after a broad
rally inspired by rising U.S. bond yields and relief at an
easing of U.S.-China trade tensions.       
    Washington and Beijing both claimed victory on Monday as the
world's two largest economies stepped back from the brink of a
global trade war and agreed to hold further talks to boost U.S.
exports to China.                            
    Meanwhile, Asia-Pacific shares outside Japan                
extended gains on Tuesday amid renewed optimism about global
growth after the U.S.-China agreement.                 
    Expectations that the Federal Reserve will lift U.S.
interest rates again next month added to downward pressure on
gold. Higher U.S. rates tend to boost the dollar and push bond
yields up, make non-yielding assets like bullion less
attractive.           
    U.S. Treasuries were steady on Monday, after benchmark
yields rose to a seven-year peak last week, as investors awaited
release of the latest Federal Reserve minutes on Wednesday.    
    Accelerating inflation means the Fed should hike interest
rates two or possibly three more times this year, and could move
as soon as next month, Philadelphia Fed President Patrick Harker
said on Monday.             
    "Somewhere around the $1,275 level we are going to start to
attract more bullish sentiment, but in the mean time the driver
is going to remain the U.S. dollar," Innes said.
    Holdings in SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund, fell 0.38 percent to 852.04
tonnes on Monday.             
    Among other precious metals, silver        slid 0.3 percent
to $16.44 an ounce, while palladium        was largely unchanged
at $989.05 an ounce.
    Platinum        climbed 0.1 percent to $896.50 an ounce,
after marking a fresh low for the year in the previous session
at $873.50.

 (Reporting by Karen Rodrigues and Apeksha Nair in Bengaluru,
Editing by Sherry Jacob-Phillips and Richard Pullin)
  
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