Gold Prices Slide to 2-Week Lows as Stronger Dollar Weighs

Investing.com – Gold prices fell to their lowest levels in two weeks on Monday as a stronger dollar and renewed risk appetite dampened demand for the precious metal.

for June delivery on the Comex division of the New York Mercantile Exchange were down $7.10 cents or 0.55% to $1,331.20 a troy ounce by 04:57 AM ET (08:57 AM GMT).

The , which measures the greenback’s strength against a basket of six major currencies, was up 0.32% to 90.37. A stronger dollar makes dollar-denominated commodities, including gold, more expensive for holders of other currencies.

Demand for the dollar continued to be underpinned after recent comments by Federal Reserve officials indicated that interest rates will continue to rise in 2018 as the economy remains on a steady course.

Expectations of higher interest rates tend to boost the dollar by making the currency more attractive to yield-seeking investors.

Higher rates are a negative for gold as the precious metal, which does not pay interest, struggles to compete with yield-bearing assets when rates rise.

North Korea said on Saturday it was suspending nuclear and missile tests and scrapping its nuclear test site ahead of planned summits with South Korea and the U.S.

Besides concerns over geopolitical risks, worries over a trade spat between the U.S. and China also appeared to be easing.

Gold is often sought by investors as a store of value in times of market turmoil and political tensions and tends to decline as investor confidence returns.

In other precious metal trade, were down 1.10% to $16.97 a troy ounce, while shed 0.62% to trade at $926.00.

Among base metals, added on 0.26% to trade at $3.143 a pound.

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