Gold price hits one-week low as US dollar firms
London (Sept 28) Gold prices slipped on Wednesday to touch a one-week low, after suffering its biggest single-day loss in nearly a month in the previous session, on a firmer dollar.
The safe haven asset slid nearly 1 percent on Tuesday, its biggest single session percentage loss since Aug. 30, as investors viewed that Democrat Hillary Clinton had won the first U.S. presidential debate against Republican rival Donald Trump, boosting the appetite for riskier assets like equities.
Spot gold fell 0.2 percent to $1,324.20 an ounce by 0656 GMT on Wednesday, and touched a bottom of $1,322.55, the lowest since Sept. 21.
U.S. gold futures eased 0.2 percent to $1,327.40 an ounce.
"Demand for gold as a safe haven has fallen, simply because Hillary has more or less trumped over Trump in the presidential debate," said OCBC Bank analyst Barnabas Gan.
"Falling gold prices suggest that market watchers look at Hillary as a safer bet than Trump."
Markets have tended to see Clinton as the candidate of the status quo, while few are sure what a Trump presidency might mean for U.S. foreign policy, trade or the domestic economy.
"The rise in risk-off sentiment has undermined (gold) prices. This is made worse by the fall in yields and U.S. dollar gains," HSBC analyst James Steel said in a note.
"We think gold may be driven lower near-term to closer to $1,310 per ounce," Steel added.
The dollar index , which measures the greenback against a basket of six major currencies, was up 0.2 percent on Wednesday. A stronger greenback makes dollar-denominated gold more expensive for holders of other currencies. "For now gold remains range-bound in a broad $1,305-1,345 range, with firm support and resistance close to these respective levels," Alex Thorndike, senior precious metals dealer at MKS PAMP Group, wrote in a note.
"We believe gold will continue to track this for the interim, with a break of either likely to see momentum build."
Holdings of the SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, fell 0.22 percent to 949.14 tonnes on Tuesday. Among other precious metals, spot silver was down for the fourth straight session having dipped 0.6 percent at $19.02 an ounce. The metal fell 1.4 percent in the previous session, its biggest single day loss in nearly three weeks.
Platinum dipped 0.1 percent at $1,021 after falling over 1 percent in the prior session.
Palladium was nearly flat at $697.72 an ounce.
Source: Reuters
