Investing.com – Gold prices were flat Wednesday, as a retreat in the dollar from highs supported metal prices despite renewed focus on U.S.-China trade tensions.
for August delivery on the Comex division of the New York Mercantile Exchange rose by $0.60 or 0.05%, to $1,227.90 a troy ounce, after trading as low as $1,220.90 intraday.
The dollar treated from near 52-week highs, pressured by data showing a wobble in the U.S. housing market.
tumbled 12.3% to a seasonally adjusted annual rate of 1.173 million units last month, the Commerce Department said.
The report also highlighted a 2.2% decline in to a rate of 1.273 million units. That was the lowest level since September 2017.
Yet investors continued to expect the retreat in greenback would be short-lived as Federal Reserve Chairman Jay Powell’s testimony before the House Financial Services Committee Wednesday did little to dent investor optimism for further rate hikes.
Expectations for further rate hikes were strengthened on Tuesday, when Powell said “the best way forward” is to continue raising rates, as the job market has strengthened and inflation has met the Fed’s 2% target.
The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was about flat near 94.75, after trading as high as 95.18 intraday.
Gold is sensitive to moves higher in both bond yields and the U.S. dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding gold as it pays no interest.
The threat of escalation in the U.S.-China trade war, meanwhile, had muted impact on metals as the downtick in the dollar dominated direction.
China’s Ministry of Commerce warned Wednesday of further countermeasures in response to U.S. steel and aluminum tariffs.
rose 0.66% to $2.77, while rose 4.54% to 2,621.25.
rose 0.17% to 2,036.50, while Nickel futures rose 1.09% to 13,690.00.
fell 0.17% to $15.59 a troy ounce, while rose 0.11% to $820.80.
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