Gold near six-week low as dollar firms, Korea tensions ease
Gold prices fell to the lowest in nearly six weeks on Monday as the dollar strengthened and easing tensions on the Korean peninsula helped boost appetite for higher risk assets such as stocks.
Spot gold lost 0.3 percent at $1,318.14 per ounce by 1:34 p.m. EDT (1734 GMT), off an earlier $1,310.11 low, its weakest since March 21. U.S. gold futures for June delivery settled down $4.20, or 0.3 percent, at $1,319.20 per ounce.
"Gold has been under selling pressure as the U.S. dollar firmed up and geopolitical risks abated," said Bart Melek, head of commodity strategy at TD Securities.
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Gold traded near key support levels. "We are looking at two important support levels - $1,307 followed by $1,300," said Naeem Aslam, chief markets analyst at Think Markets. "A break of these levels would bring more selling pressure."
North Korean leader Kim Jong Un and South Korean President Moon Jae-in on Friday declared they would take steps to formally end the 1950-53 Korean War, which ended only with a truce, and work towards the "denuclearisation" of the Korean peninsula.
"The signs of detente in the North Korean conflict are ... contributing to the lack of solid demand for gold as a safe haven at present," Commerzbank said in a note.
"Following the historic meeting between North Korean leader Kim Jong-un and South Korean President Moon Jae-in, North Korea appears ready to shut down its nuclear testing facility in the country`s northeast soon."
The dollar index rose to near three-month highs against the euro after weaker-than-expected German data hurt the euro.
World stocks are on track to rise this month for the first time since January, lifted by positive earnings from U.S. technology firms and a string of high-profile M&A deals.
Investors are waiting to see more inflationary signals before making big moves in gold, said George Gero managing director of RBC Wealth Management. "We continue to talk to long-term investors about being patient holders (of gold)."
Among other precious metals, silver declined 1 percent at $16.33 an ounce, off an earlier three-week low of $16.18. Platinum was down 0.8 percent at $903.40 an ounce earlier dipping to a more than 4-month low of $898.10.
Palladium lost 0.7 percent at $967.20 an ounce.
On a monthly basis, palladium is the biggest riser among the major precious metals in April, up 1.1 percent after U.S. sanctions on major producer Russia stoked concerns over supply. Platinum, down 2.5 percent, is the biggest faller so far.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)