Gold prices ease as investors look to riskier assets
Gold prices hit their lowest in over a week on Tuesday, as a lull in geopolitical tensions spurred a pick-up in investor appetite for riskier assets such as equities.
Asian shares marked a 10-year peak early in the day and the dollar held gains, with investors breathing a sigh of relief as fears over North Korea eased slightly and the worst-case scenario from Hurricane Irma looked to have been avoided.
Spot gold dipped 0.1 percent to $1,325.11 an ounce by 0615 GMT, after earlier touching its lowest since Sept. 1 at $1,322.85.
The metal fell 1.4 percent in the previous session, its biggest one-day percentage decline since early July.
U.S. gold futures for December delivery were down 0.4 percent at $1,330.40.
"The lack of an expected North Korean missile launch, and expectations that Hurricane Irma will have less of an impact than previously anticipated led to a rekindling of `risk-on` sentiment," said John Sharma, economist at National Australia Bank.
Irma, earlier ranked as one of the most powerful Atlantic hurricanes on record, was downgraded to a tropical storm on Monday after wreaking havoc across Florida.
Fears over North Korea receded slightly after the nation marked its founding day without further nuclear tests.
The United Nations Security Council unanimously stepped up sanctions against North Korea over the country`s sixth and most powerful nuclear test on Sept. 3, imposing a ban on the country`s textile exports and capping crude oil imports.
"We expect continued - although somewhat restrained - demand for gold due to continued economic and geopolitical uncertainty, which should keep gold slightly above $1,300/oz in the near future," Sharma added.
Spot gold may drop to $1,317 per ounce, as it has broken support at $1,332, said Reuters technical analyst Wang Tao.
"We suspect that the dollar rally could have more room to run ... we could see a retracement in the precious metal to around $1,310-$1,315 before an element of underlying support sets in," INTL FCStone analyst Edward Meir said in a note.
A stronger greenback makes dollar-denominated gold more expensive for holders of other currencies.
However, analysts at Bank of America Merrill Lynch said in a note on Monday that the U.S. currency could remain supportive for gold, with the precious metal on track to hit its $1,400 per ounce target in coming months.
In other precious metals, silver was down 0.2 percent at $17.77 an ounce after having earlier hit its lowest since Sept. 1
Platinum was down 0.2 percent at $988.05, while palladium was 0.7 percent higher at $938.25 an ounce.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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