Gold pares gains on U.S.-China trade war optimism
* Trump says will meet with Xi, trade talks set to restart
* ECB to ease policy again if inflation fails to
* Fed due to release its latest statement on Wednesday
* Gold may break support at $1,337/oz, fall to $1,324-
* Palladium hits 12-week high
June 18 (Reuters) - Gold prices pared gains on Tuesday after
U.S. President Donald Trump confirmed he would meet with Chinese
President Xi Jinping at an international summit, fanning hopes
for a quick end to the U.S.-China trade dispute.
Earlier in the session, gold prices had briefly surged to 1%
after central banks in Europe and the United States hinted at
Spot gold gained 0.5% to $1,345.70 per ounce as of
1:32 p.m. EDT (1732 GMT). Prices had risen to $1,354.20 earlier,
before Trump said in a tweet he had a "very good telephone
conversation" with China's Xi.
The two leaders will meet at the G20 meet later this month
in Japan, where the discussions will focus on trade in the midst
of a bitter tariff spat, that has upset global markets since its
conception a year ago.
U.S. gold futures settled 0.6% higher at $1,350.7
"We are seeing a bit of a resurgent in risk appetites," said
Bart Melek, head of commodity strategies at TD Securities in
Toronto, adding that equities have moved higher, which has
helped the dollar.
"Commodities on the risk side have gone up and gold has
traded lower, on the back of the agreement between the U.S. and
China on the trade side."
Equity markets rallied following Trump's comments while the
dollar index held tight at two-week highs.
European Central Bank President Mario Draghi said the bank
would need to ease policy again with tepid inflation, while
markets expect the U.S. Federal Reserve to cut interest rates
later this year.
"Traders are looking at an immediate future for easing money
from central banks, which should see gold trading higher for the
time being," said Bob Haberkorn, senior market strategist at RJO
Spot gold may break a support at $1,337 per ounce and fall
to the next support at $1,324, according to Reuters technical
analyst Wang Tao.
"As long as gold holds the $1,333 level intraday, it is good
for bullion," said Michael Matousek, head trader at U.S. Global
Investors. "Prices ran up after expectations from central banks,
but there has been no definitive answers to retain those levels
on an intraday basis."
Other precious metals rose as well, with silver
gaining 1.1% to $15 per ounce and platinum up 1.4% at
Palladium rose 2.2% to $1,481.51 per ounce, after
hitting $1,489.03 the session, its highest level since March 27.
(Reporting by Karthika Suresh Namboothiri and Diptendu Lahiri
Editing by Marguerita Choy and Richard Chang)
First Published: 2019-06-18 03:45:25
Updated 2019-06-18 19:57:13
© 2019 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.