Investing.com – Metal prices were kept on the back foot Monday, as a rising dollar and lingering U.S. trade-war concerns weighed on sentiment.
for August delivery on the Comex division of the New York Mercantile Exchange fell by $5.80, or 0.47%, to $1,217.40 a troy ounce, just above session lows of $1,218.50.
As trade tensions between the U.S. and China increase, traders appear to betting a strong U.S. economy would be able to weather the trade-war storm better than its rivals, raising demand for the dollar, pressuring gold prices.
“You have rising income, rising labor participation, rising confidence, and all of that consumer spending accounts for two thirds of our (U.S.) GDP,” said Scott Clemons, chief investment strategist for Brown Brothers Harriman in New York last week.
“Our starting position is much stronger than the Chinese because trade doesn’t matter as much to the American economy,” he added.
China state media launched a scathing attack on President Donald Trump, who claimed over the weekend that that tariffs were working “big time” and that imported goods should be taxed or made in the United States.
President Trump is orchestrating “street fighter-style deceitful drama,” forcing the United States’ trading partners to “cede their interests to those of the U.S.,” China Daily said Monday.
China said on Friday it would impose duties of 25%, 20%, 10% and 5% on U.S. products worth more than $60 billion if the Trump administration followed through on threats to impose harsher tariffs on $200 billion of Chinese goods.
The , which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.17% to 95.19.
Gold is sensitive to moves higher in both bond yields and the U.S. dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding gold as it pays no interest.
Data last week showed traders increased their bearish bets on gold for the third-straight week.
data showed money managers reduced their net long positions in gold futures to 35,300 lots from 48,600 lots for the week ended July 27.
The wider metal markets traded mix as nickel prices rose while copper fell sharply even as analysts cited signs of robust copper demand.
“Higher outlays from utilities are particularly supportive this time around because the investment focus has shifted from aluminium-intensive power transmission to copper-intensive distribution networks,” Merrill Lynch said in a note to clients.
fell 1.39% to $2.73, while fell 1.29% at 2,573.00.
rose 1.06% to 2,049.50, while rose 1.31% to 13,692.00.
fell 0.76% to $15.35 a troy ounce, while fell 1.41% to $825.10.
Source: Investing.com
