Gold was steady on Wednesday as weaker dollar prices offset pressure on the metal, which recovered from a four-week low in the previous session, while a rally in equities to multi-month highs capped bullion’s safe-haven demand.
Spot gold was flat at $1,292.48 per ounce as of 0354 GMT, having touched its lowest level since March 7 at $1,284.76 in the previous session. U.S. gold futures firmed 0.1 percent at $1,296.90 an ounce.
“There won’t be much movement in gold prices as stocks have gone up to their highs in Asia and investors are not seeing gold as a good safe-haven,” said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
Asian shares climbed to seven-month highs as investors lapped up signs of progress in U.S.-China trade talks and brisk economic data.
Markets drew hope from White House economic adviser Larry Kudlow, who on Tuesday said the two countries “expect to make more headway” in trade talks this week.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are due to resume talks with Chinese vice premier Liu He later on Wednesday.
The dollar index which had secured preference over gold on the backdrop of U.S.-China trade tensions, was weaker about 0.2 percent, after climbing a 3-1/2-week peak in the previous day.
A weaker dollar tends to make gold cheaper for holders of other currencies.
The market is also closely following developments around Britain’s departure from the European Union. Prime Minister Theresa May said on Tuesday she would seek another Brexit delay to agree an EU divorce deal with the opposition Labour leader.
“Brexit is approaching some conclusion; in the least, this should weaken the dollar against both the sterling and the euro and perhaps give gold a bit of a lift,” INTL FCStone analyst Edward Meir wrote in a note.
Signifying investor sentiment toward bullion, holdings in the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, fell to their lowest since March 8 at 768.10 tonnes on Tuesday.
Among other precious metals, spot palladium was up 0.4 percent at $1,434.55 an ounce.
Silver gained 0.3 percent to $15.16 per ounce having touched its lowest level since late December at $14.90 in the previous session, while platinum rose 1.1 percent to $851.15.
Source: Reuters
