Gold hovers near two-week low as US-China trade optimism dents demand
[BENGALURU] Gold prices hovered n Tuesday (Oct 28) near their lowest in more than two weeks, as optimism over a possible US-China trade deal dented demand for the safe-haven metal, while investors looked forward to major central bank policy announcements this week.
Spot gold was flat at US$3,981.67 per ounce, as at 8.24 am, after dropping more than 3 per cent in the previous session to its lowest level since Oct 10.
US gold futures for December delivery lost 0.6 per cent to US$3,996.50 per ounce.
On Sunday, top Chinese and US economic officials hashed out the framework of a trade deal for US President Donald Trump and his Chinese counterpart Xi Jinping to decide on later this week.
Trump said that he thought a deal would be reached with China and announced a flurry of deals on trade and critical minerals in Malaysia with four South-east Asian nations during the first stop of a five-day Asia trip.
The US Federal Reserve is widely expected to cut the interest rate at the end of its policy meeting on Wednesday. Investors await any forward-looking language from Fed chair Jerome Powell.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Meanwhile, the European Central Bank and the Bank of Japan are both broadly expected to hold rates steady later this week.
Gold prices have gained about 51 per cent this year, reaching an all-time peak of US$4,381.21 on Oct 20, bolstered by geopolitical and economic uncertainties, rate-cut bets and sustained central bank buying.
Gold’s winning streak is seen extending into next year, with analysts forecasting an annual average price above US$4,000 per ounce for the first time as economic and geopolitical turmoil keep the metal’s safe-haven allure intact, a Reuters poll showed.
SEE ALSO
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.77 per cent to 1,038.92 tonnes on Monday from 1,046.93 tonnes on Friday.
China’s net gold imports via Hong Kong in September dropped 17.6 per cent from levels seen in August, Hong Kong Census and Statistics Department data showed on Monday.
Elsewhere, spot silver fell 0.3 per cent to US$46.74 per ounce, platinum slipped 1.2 per cent to US$1,571.85 and palladium dipped 0.8 per cent to US$1,391.15. REUTERS
