June 1, 2018 / 4:57 AM / 10 months ago

PRECIOUS-Gold steady amid renewed trade tensions

    * Firm dollar, positive U.S. data weigh on mkt
    * Spot gold down slightly this week
    * Platinum, palladium set for 2nd weekly gain
    * SPDR holdings fall 0.52 pct on Thursday

 (Adds comments, details and updates prices)
    By Karen Rodrigues
    BENGALURU, June 1 (Reuters) - Gold prices were steady in
Asian trade on Friday on renewed fears of a global trade war,
while a firm dollar and positive U.S. economic data weighed on
the market.
    Spot gold        was nearly unchanged at $1,298.29 per ounce
by 0641 GMT, while U.S. gold futures         for June delivery
were down 0.2 percent at $1,298 per ounce. Spot gold is down
slightly this week.
    Gold's current price movement reflects the relatively calm
attitude of investors, said Mark To, head of research at Hong
Kong's Wing Fung Financial Group.
    "These uncertainties are to be with us for quite some time,
so sooner or later investors will get used to it," To said,
adding that he expected gold to trade in the $1,296-$1,305
    Fears of a global trade war emerged after the United States
on Thursday went ahead with tariffs on aluminium and steel
imports from Canada, Mexico and the European Union, ending the
two-month exemption it had given earlier. Canada and Mexico
retaliated against this decision.             
    Political and economic tensions may support gold prices to a
certain extent, but an interest rate hike from the U.S. Federal
Reserve this month may provide the metal some kind of
resistance, To said.
    U.S. consumer spending accelerated in April and inflation
continued to rise steadily, underpinning the case for a U.S.
interest rate hike this month.             
    Higher interest rates tend to boost the U.S. dollar and push
bond yields up, pressuring gold prices by increasing the
opportunity cost of holding non-yielding bullion.
    The dollar index       , which measures the greenback
against a basket of six major currencies, was up 0.2 percent at
    "It was a typical pre-NFP (non-farm payroll) session, with
traders and investors happy to relax and await the data to
reassess direction next week," MKS SA senior precious metals
dealer Alex Thorndike said.
    The markets are awaiting May non-farm payrolls, unemployment
rate and ISM manufacturing PMI data due later in the day.
    Holdings of SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund, fell 0.52 percent to 847.03
tonnes on Thursday.          
    In other precious metals, spot silver        gained 0.2
percent to $16.39 an ounce, but was down about 0.3 percent this
    Platinum        rose 0.2 percent to $903.20 per ounce, while
palladium        was nearly unchanged at $984.60 an ounce. Both
were headed for a second straight weekly gain.

 (Reporting by Karen Rodrigues in Bengaluru
Editing by Joseph Radford and Subhranshu Sahu)
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