Gold Prices Slip as Dollar Extends Gain

Investing.com – Gold prices slipped on Friday as the dollar extended gains from the previous session. A strong U.S. inflation report and continued trade war concerns were cited as tailwind for the greenback.

for August delivery on the Comex division of the New York Mercantile Exchange slipped 0.1% to $1,245.40 a troy ounce by 1:45AM ET (05:45 GMT).  

Meanwhile, the dollar rose on Friday, trading near a 10-day peak after U.S. consumer prices data showed a build-up of inflation pressure that would allow the Fed to raise rates as many as four times this year. 

The that tracks the greenback against a basket of currencies was up 0.7% at 94.87. 

“The dollar has benefited this week from the trade conflict concerns that emerged earlier, which ended up funneling safe-haven bids into the currency,” said Koji Fukaya, president of FPG Securities in Tokyo. 

“On top of that, the U.S. economy has shown it is doing well and Treasury yields have risen, and these factors are all helping the dollar.” 

A stronger dollar and higher U.S. rates reduce demand for non-interest bearing gold as the metal becomes more expensive for holders of other currencies.

U.S. Treasury Secretary Steven Mnuchin said on Thursday that he and the administration are “available” for discussion, but China must first agree to deeper economic reforms.  

“To the extent that China wants to make structural changes, I and the administration are available,” Mnuchin said on Thursday. “We are not advocating tariffs. We are advocating fair trade.” 

China’s Vice Minister of Commerce Wang Shouwen also said on Thursday “when we have a trade problem, we should talk about it.” 

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