Investing.com – Gold prices surged on Friday as American officials dashed hopes for an imminent solution to trade tensions between China and the U.S. and the dollar suffered from dovish comments from the Federal Reserve and a bearish call from Morgan Stanley (NYSE:).
At 10:49 AM ET (15:49 GMT), for December delivery on the Comex division of the New York Mercantile Exchange jumped $22.50, or 1.85%, to $1,221.70 a troy ounce.
U.S.-China Trade Deal Hopes Fade
Recent hopes that trade tension between China and the U.S. may be receding on reports of continuing talks ahead of U.S. President Donald Trump and Chinese President Xi Jinping at the G20 summit later this month began to fade as officials deemed a deal to be unlikely.
A senior Trump administration official told Reuters on Thursday that China’s written response to U.S. demands for trade reforms, received earlier this week, was .
U.S. Trade Representative Robert that he had told some industry executives that another round of tariffs on Chinese imports had been put on hold as the two nations pursue talks.
“The plan for the tariffs … has not changed at all. Any reports to the contrary are incorrect,” a spokesperson for Lighthizer’s office said in a statement.
Disappointment saw traders adopt a risk-off sentiment on Friday, pulling out of equities and into the safe-haven precious metal.
Dollar Drop Boosts Gold After Dovish Fed Comments, Bearish Broker Call
Meanwhile, the U.S. , which tracks the greenback against a basket of six major currencies, dropped 0.40% to 96.40 by 10:51 AM ET (15:51 GMT).
A stronger greenback makes the dollar-denominated precious metal more expensive for holders of foreign currencies.
Losses in the dollar deepened as Morgan Stanley called a dollar peak on Friday, while a Fed policy maker suggested the central bank was near its target.
In a bearish stance on the dollar, Morgan Stanley commented that weaker equity and credit prices were reasons to pare U.S. currency exposures.
Fed Vice Chairman told CNBC on Friday that the , suggesting that the time for a pause could be forthcoming.
The remarks followed on the back of a similar message on Wednesday from Fed Chairman , who warned of slowing demand abroad, fading fiscal stimulus at home and the lagged economic impact of the Fed’s past rate increases, suggesting that a .
Chicago Fed President is scheduled to speak on the economy and monetary policy at 11:30 AM ET (16:30 GMT).
In other metals trading, jumped 2.82% at $14.345 a troy ounce by 10:51 AM ET (15:51 GMT).
rose 1.71% to $1,156.80 an ounce, while sister metal edged forward 0.39% at $848.60.
In base metals, traded up 0.58% to $2.765 a pound.
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Source: Investing.com
