Gold falls on increased risk appetite

Gold prices inched lower on Friday due to increased risk appetite on hopes of an interim Sino-US deal being signed soon and as investors awaited the release of US GDP data. Spot gold edged 0.1% lower to $1,478/oz by 1.35am GMT. US gold futures fell 0.2% to $1,482/oz.

US treasury secretary Steven Mnuchin said on Thursday the US and China would sign their so-called phase one trade pact at the beginning of January, adding that it would not be subject to any renegotiation. China’s finance ministry unveiled a new list of import tariff exemptions for a duration of one year starting December 26 for six chemical and oil products from the US.

Asian shares firmed, close to the 18-month peak, as trade thinned in the run-up to Christmas and the market absorbed the positive trade update. The dollar index, all set to gain for the first week in four, held steady against a basket of currencies, making gold cheaper for holders of other currencies. 

In the US, economic data showed mixed signals as the initial jobless claims report was strong with applications for unemployment benefits slipping from a more than two-year high, while factory activity data for the mid-Atlantic region was almost flat in December.

Prime Minister Boris Johnson unveiled what he called a radical government agenda on Thursday, setting his sights on a quick Brexit, future trade deals and on transforming Britain to repay the trust of voters who handed him a landslide election victory.

Elsewhere, palladium rose 0.4% to $1,943.74/oz. The metal prices had hit an all-time peak of $1,998.43/oz on Tuesday. Silver slid 0.1% to $17.03/oz, while platinum edged up 0.1% to $934.60/oz.

Reuters