Gold price edges off 2-week low as focus holds on U.S.-China talks
New York (Nov 26) - Gold edged off an early two-week low on Tuesday as cautious traders awaited further developments in the trade negotiations between the United States and China, though a firm equities market kept a lid on bullion's gains.
Spot gold was up 0.2% at $1,457.58 per ounce at 1046 GMT, having earlier touched its lowest since Nov. 12 at $1,451.15. U.S. gold futures inched 0.1% higher to $1,457.50.
"We are stuck in a relatively tight range between $1,450 and $1,475 and are basically just awaiting further developments (in trade talks)," said Saxo Bank commodity strategist Ole Hansen.
"There is some fatigue in the market," he said. "Yes, they (the U.S. and China) are talking, and yes, they are trying to give a positive spin to it, but we're still missing the actual deal."
World stocks hit their highest in almost two years following fresh signs that the United States and China were working to end a bitter trade war that has dealt a blow to the global economy.
Gold, considered a safe asset in times of political and economic uncertainty, has gained more than 13% this year, mainly due to the tariff dispute and its impact on global economic growth.
Chinese Vice Premier Liu He, U.S. Trade representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin discussed issues related to phase one of a trade deal and agreed to maintain communication on remaining issues.
"We're now back around the $1,440-1,460 support zone," Craig Erlam, OANDA senior market analyst, said in a note. "A break of this would be very significant and could potentially open up a move back towards the $1,400 area."
Meanwhile, U.S. Federal Reserve Chair Jerome Powell said on Monday officials had a favourable outlook on the U.S. economy. However, weak global growth and trade uncertainty are holding back expansion and they will "respond accordingly" if economic data leads to a "material reassessment" of their outlook, Powell added.
The central bank cut interest rates three times this year before pausing. Lower rates reduce the opportunity cost for holders of bullion, an asset that yields no interest. Investors' focus is now on the U.S. consumer confidence data due at 1500 GMT.
Elsewhere, silver was up 0.2% at $16.93 per ounce. Palladium was down 0.4% to $1,790.47 per ounce, having earlier hit its highest since Nov. 4 at $1,818.54, and platinum gained 0.2% to $898.71.
Reuters
