Investing.com – Gold prices traded lower on Friday, with spot prices hitting a 17-month low, as concerns over the crisis in Turkey sent investors flocking to the dollar, dampening demand for the precious metal.
At 4:19 AM ET (8:19 GMT), fell $6.60, or 0.54%, to $1,204.81, just off an intraday low of $1,203.83, its lowest level since March 2017.
Meanwhile, for December delivery on the Comex division of the New York Mercantile Exchange lost $7.00, or 0.57%, to $1,212.00 a troy ounce.
Markets have been closely following the situation as tensions between the U.S. and Turkey escalate.
After U.S. President Donald Trump doubled tariffs on the Turkey’s steel and aluminum on Friday to 50% and 20%, respectively, in an attempt to put the brakes on the decline in its currency which hit a historic low against the dollar.
“From Monday morning onwards our institutions will take the necessary steps and will share the announcements with the market,” Finance Minister Berat Albayrak said Sunday.
The central bank said it cut the lira’s reserve requirement ratio, a cash buffer held by banks, by 250 basis points for all maturity brackets and lowered reserve requirement ratios for non-core FX liabilities by 400 basis points for maturities up to three years.
The situation in Turkey has kept markets on edge, particularly in Europe where investors are concerned about the exposure the region’s banks have to Ankara, and traders have opted for the safe haven safety of the .
A stronger greenback makes the dollar-denominated metal more expensive for holders of foreign currencies.
Limiting gold’s losses, reports on Monday suggested that China’s demand for gold is rising. David Harquail, chairman of the World Gold Council (WGC), estimated that gold consumption will continue to grow in China and that it would purchase about 30% of the gold sold globally, in the form of jewelry.
WGC also said that in the second quarter, demand for gold fell by 4% year-on-year globally and purchases for investment purpose also slid 9%, but China’s consumption of gold went up by 7% year-on-year.
In other metals trading, fell 0.46% at $15.225 a troy ounce by 4:21 AM ET (8:21 GMT).
slumped 1.22% to $890.10 an ounce, while sister metal slid 1.39% at $818.10
In base metals, traded down 0.71% to $2.723 a pound.
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Source: Investing.com
