Gold dips as risk appetite heightens, dollar gains on upbeat U.S. data
Gold dips as risk appetite heightens, dollar gains on upbeat U.S. data
Gold prices slipped on Tuesday to their lowest in more than five weeks as the dollar rose on stronger-than-expected economic data and rising U.S. Treasury yields, while global equities prices rose on improved risk sentiment.
"With the U.S.-China trade agreement looking like it will happen and the softening of Brexit negotiations seeming to be developing into a positive thing, people are getting out of metals and converting it to equities," said Walter Pehowich, executive vice president of investment services at Dillon Gage Metals.
"If there is a (trade) agreement, there is a lot more room on the upside for equities and then the bull run in gold is over."
Spot gold fell 0.3 percent to $1,282.82 per ounce as of 10:42 a.m. EST (1542 GMT). The session low was $1,280.70, the lowest since Jan. 25.
U.S. gold futures dropped 0.3 percent to $1,283.80 per ounce.
On Friday, gold dropped below $1,300 an ounce, hurt by a robust dollar. Gold has shed over 2 percent this month as trade talks between Beijing and Washington accelerated, with reports saying a deal could be sealed at a summit around March 27.
Global stock markets were firm at five-month highs following China`s assurance of stimulus measures after lowering its growth targets.
"As long as world stock markets remain in near-term price uptrends, it will be difficult for gold and silver markets to sustain rallies," said Jim Wyckoff, senior analyst at Kitco Metals in a note.
The U.S. dollar stood close to a two-week peak against key peers at 96.726, supported by strong data on new home sales and services industries, which eased worries about a deceleration in U.S. economic growth.
Investment bank Goldman Sachs raised its 12 month gold price forecast to $1,450 per troy ounce from $1,425.
Markets will now look ahead to the European Central Bank`s monetary policy meeting on Thursday and U.S. non-farm payrolls data on Friday.
Among other precious metals, silver was up 0.3 percent at $15.12 per ounce. During the session it slumped as low as $15.01, its lowest since Dec. 27.
Spot palladium declined 1.3 percent to $1,513.71 per ounce while platinum was little changed at $834.78.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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