Investing.com – Gold prices headed higher on Wednesday as the latest tit-for-tat in trade tensions between the U.S. and China caused flight to the safe haven precious medal.
for June delivery on the Comex division of the New York Mercantile Exchange were last up by $7.20, or around 0.5%, to $1,344.50 a troy ounce at 10:38AM ET (14:38GMT).
China’s commerce ministry announced Wednesday on $50 billion of U.S. goods, including autos and chemicals and said the effective date for the new tariffs would be announced at a later time.
The announcement came after the late Tuesday announced 25% tariffs on $50 billion of annual imports from China in an attempt to force changes in Beijing’s intellectual property practices.
Worries that protectionist trade policies from the U.S. and China might result in a trade war boosted gold, amid fears over the impact on global economic growth, as market participants tend to seek out gold as a store of value during times of political or economic uncertainty.
Persistent worries over global trade tensions also weighed on the U.S. dollar which in turn makes the dollar-denominated metal cheaper for holders of other currencies.
At 10:39AM ET (14:39GMT), the , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last down 0.21% to 89.66.
Little support for the dollar was seen despite publication of a better-than-expected reading on job creation. According to the , the U.S. created in March, beating expectations for just 208,000 positions.
Investors were turning their attention to the more comprehensive official government report that will be released on Friday. Economists expect the creation of .
Signs of increasing wage growth in that report could underline the case for the Federal Reserve to raise interest rates at a faster pace.
Fed chairman will have an opportunity to comment on the employment report in an appearance scheduled after the release on Friday, which could determine the direction of the U.S. currency.
Expectations of rising rates tend to boost the dollar by making the currency more attractive to yield-seeking investors.
In other economic data out Wednesday, the (PMI) for March, along with and for February all came in weaker than forecast.
Elsewhere in metals trading, fell 0.53% to $16.305 a troy ounce by 10:40AM ET (14:40GMT), slid 1.44% at $917.90 a troy ounce, traded down 1.71% to $911.95 a troy ounce, while tumbled 2.14% to $2.998 a pound.
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Source: Investing.com
