LONDON. — Gold prices held steady yesterday as investors kept a cautious stance ahead of a fresh round of Sino-US trade talks, while a firmer dollar capped gains for the bullion, which was drawing support from global economic slowdown worries.
Spot gold was firm at $1,309 per ounce, as of 0605 GMT, after falling 0,4 percent in the previous session.
US gold futures were also mostly unchanged at $1,312.70 per ounce.
“Gold is being pushed around by the U.S. dollar in the near term. Traders are getting out of anything to do with Europe on concerns of weakness in the region and going for safe-haven buying into US treasuries, which is pushing up the dollar,” said Kyle Rodda, market analyst, IG Markets.
When investors buy US Treasury bonds, they are also required to purchase the greenback, which makes dollar-denominated gold more expensive for holders of other currencies, potentially subduing demand.
“Gold is still very resilient and should trade in the range of $1,305 to $1,320, with investors looking for headlines around trade talks, U.S. government shutdown and data from United States and China for signs of weakness in the economy,” Rodda said.
New round of trade talks between China and the United States started in Beijing on Monday with world’s two largest economies trying to hammer out a deal before a March 1 deadline, after which US tariffs on $200 billion worth of Chinese imports are scheduled to increase to 25 percent from 10 percent. — Reuters