Gold is hardly changed as dollar stands firm

Bengaluru — Gold prices were steady on Monday, capped by headwinds from a firm dollar, while investors looked to the Group of 20 (G20) meeting this week for signs of a thaw in the China-US trade conflict.

Spot gold inched 0.1% higher to $1,223.31/oz by 4.15am GMT. US gold futures were up about 0.1% at $1,223.80/oz.

“People are moving some of their capital into gold at this point of time, given the uncertainties around the pace of rate hikes by the Fed, the US-China trade war.… People see gold as a hedge against these uncertainties,” said Brian Lan, MD at Singapore dealer GoldSilver Central.

However, a stronger dollar restricted further gains in the price of the metal.

The dollar index, which measures the greenback against a basket of six major currencies, was up about 0.1%, as investors sought shelter in safe haven currencies as fears of a global growth slowdown and US-China trade tensions sapped risk appetite.

“Dollar movements will ultimately provide gold’s near-term direction,” said Stephen Innes, Asia-Pacific trading head at Oanda in Singapore.

Gold market participants are now focusing on talks between US President Donald Trump and Chinese President Xi Jinping to be held on the sidelines of a G20 summit in Argentina at the end of this week.

Officials from some G20 countries, anxious to see a swift end to the China-US trade war, are hopeful but not confident that the meeting may yield at least a partial ceasefire.

“The growing unease regarding the G20 summit and the possibility of a deal has seen gold prices hold up relatively well,” analysts at ANZ said in a note.

The US Federal Reserve’s Federal open market committee will also release the minutes from its November 7-8 policy meeting later this week. The market will look for any discussion of what conditions might bring about a Fed pause.

Among other precious metals, silver climbed 0.6% to $14.33/oz.

Platinum edged 0.1% higher to $839.70 and palladium gained 1.1% at $1,131.00/oz. Prices fell about 3% in the previous session, their biggest one-day percentage decline since August 15.

Reuters