Gold edges higher, but lingers near 6-month trough

Gold edges higher, but lingers near 6-month trough

Gold prices inched up on Thursday, but hovered close to an over six-month low hit in the previous session, as the dollar failed to build on overnight gains amid conflicting signals from Washington while the US-China trade row deepened.


Spot gold was up 0.1 per cent at $1,253.20 an ounce, as of 0127 GMT. In the prior session, it touched $1,250.30, its lowest since mid-December.

US gold futures were down 0.1 per cent at $1,254.60 an ounce.

The dollar index against a basket of six major currencies stood steady at 95.254 , though it failed to build on overnight gains amid conflicting signals from Washington on a proposal to restrict Chinese investment as the bitter US-China trade row kept financial markets on edge.

US President Donald Trump on Wednesday said he will use a strengthened national security review process to thwart Chinese acquisitions of sensitive American technologies, a softer approach than imposing China-specific investment restrictions.

Tariffs on US imports of Chinese goods imposed by the Trump administration could hit up to 15 per cent of goods moving through the Port of Los Angeles once they go into effect, the port’s executive director Gene Seroka told Reuters.

The rapidly deteriorating trade and investment relationship between Washington and Beijing is sending a further chill through Chinese dealmakers who have already seen the number of Chinese acquisitions of American assets take a big hit.

Two major auto trade groups warned the Trump administration that imposing up to 25 per cent tariffs on imported vehicles would cost hundreds of thousands of auto jobs.

Moscow and Washington struck a deal on Wednesday to hold a summit soon between Russian President Vladimir Putin and US President Donald Trump, a move likely to worry some US allies and draw a fiery reaction from some of Trump’s critics at home.

The Federal Reserve should continue to gradually raise interest rates to lower the risk of a major policy error, Boston Federal Reserve President Eric Rosengren said on Wednesday.

The US economy is growing at a 4.5 per cent annualized rate in the second quarter following the latest data on home sales and advance trade balance released this week, the Atlanta Fed’s GDPNow forecast model showed.

The Canadian government said it had rejected the proposed Ajax open pit gold and copper mine in the Pacific province of British Columbia, citing what it said were significant adverse environmental effects.

Holdings of SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.36 per cent to 821.69 tonnes on Wednesday.