Investing.com – Gold future price dipped on Thursday in Asia. Risk appetite returned today following reports that the U.S. and China are working on multiple memorandums of understanding (MoU) for a trade deal.
Citing sources familiar with the matter, Reuters reported that the MoUs would cover areas including agriculture, non-tariff barriers, services, technology transfer and intellectual property. The move is the most significant progress yet toward ending the Sino-U.S. trade war, Reuters said.
“The broad outline of what could make up a deal is beginning to emerge from the talks,” the source said, although he cautioned the trade talks could still fail.
The news was cited as a tailwind for Asian equities on Thursday, while the safe-haven gold dipped.
In , gold’s benchmark April contract on the Comex division of the New York Mercantile Exchange fell 0.5% at $1,340.95 per ounce by 1:50 AM ET (06:50 GMT).
Minutes from the U.S. Federal Reserve’s January meeting received some focus earlier in the day, as the Fed signalled it was preparing to stop trimming its balance sheet later this year.
“Almost all participants thought that it would be desirable to announce before too long a plan to stop reducing the Federal Reserve’s asset holdings later this year,” the minutes showed.
The Fed also expressed a willingness to keep rate hikes on hold to get a better sense of the health of the U.S. economy and the extent of deteriorating global growth.
In a weaker interest rate environment, investor appetite for gold strengthens as the opportunity cost of holding the precious metal decreases relative to other interest-bearing assets such as bonds.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.