Gold Prices Down Slightly In Asia With Holiday Range Trade In Place

Investing.com Gold prices eased slightly in Asia on Tuesday with the market in a pre-holiday lull and awaiting a Bank of Japan policy review to conclude on Wednesday and a US tax cut package expected to pass this week.

for February delivery on the Comex division of the New York Mercantile Exchange fell by 0.06% to $1,264.80 a troy ounce.

Overnight, gold prices rose on Monday, buoyed by dollar weakness on tax reform jitters despite reports suggesting Republicans lawmakers could vote on the final tax bill as soon as Tuesday.

Gold prices made a bold start to week shrugging off signs of progress on tax reform following a report from Reuters, citing aides, that Republican lawmakers could vote on tax legislation as soon as Tuesday, boosting the chances of the tax bill passes this week.

“We want to give you, the American people, a giant tax cut for Christmas. And when I say giant, I mean giant,” President Donald Trump said in a speech at the White House last week.

Gold prices added to gains from last week which followed the Federal Reserve’s decision to hike rates for the third time this year. Some analysts expect the trend to continue amid central banks’ accommodative monetary policy stance, and ongoing political uncertainty.

“The main contributory factors here [to the price of gold] remain the extremely loose monetary policy pursued by nearly all key central banks, resulting in ongoing very low to negative interest rates,” Commerzbank (DE:) said. “Political uncertainty is also likely to be a constant feature throughout the year.”

Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.

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