Gold prices fall
LONDON. — Gold fell yesterday, but remained stuck in a narrow trading range as investors worry about a simmering trade war between the United States and China.
Spot gold was down 0,3 percent to $1 193,61 an ounce at 1200 GMT, after hitting its lowest since 24 August at $1 187,21 on
Tuesday. U S gold futures eased 0,3 percent to $1 198,40 an ounce.
The trade conflict between Washington and Beijing has prompted investors to buy the U.S. dollar in the belief that the United States has less to lose from the dispute.
“It looks like gold will remain in a sideways trend until something forces it either way,” said Commerzbank analyst Daniel Briesemann, adding that given the uncertainty in the world “gold will go much higher before the year is out.”
Gold has been stuck in a $20 price range over the past two weeks, with investors looking for technical breakouts for clues on further movements.
Gold has lost out to the dollar in a battle for safe-haven flows. A firmer dollar makes gold more expensive for holders of other currencies but on Wednesday the dollar was marginally lower against a basket of currencies.
It touched a three week high of 95,74 last week.
In addition, a sell-off in the Chinese yuan made the metal more expensive for buyers from the world’s top consumer of the metal.
“Gold is moving without a clear direction and it seems locked between $1 190 and $1 200,” said ActivTrades chief analyst Carlo Alberto De Casa.
“Investors are awaiting new moves to see if bullion can prolong the weak recovery seen in the second half of August, even if the main trend still appears bearish.”
The U S central bank is widely expected to raise benchmark interest rates at its September meeting and expectations are growing for one more hike in December on positive economic data.