* Breach of $1,485/oz level could push gold above $1,500 -
* Silver hits more than one-week high
* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl
By Karthika Suresh Namboothiri
Dec 3 (Reuters) - Gold jumped more than 1% on Tuesday on
fading optimism surrounding a U.S.-China trade deal after U.S.
President Donald Trump said talks could extend until after the
presidential elections in November 2020.
Spot gold gained 1.1% to $1,478.38 per ounce as of
02:32 p.m. ET (1932 GMT), after touching $1,481.80, its highest
since Nov. 7.
U.S. gold futures settled 1% higher at $1,484.40.
"Stock markets are lower and there is flight to safety in
gold right now. Gold prices are up with what Trump said about
China-U.S. tariffs," said Bob Haberkorn, senior market
strategist at RJO Futures.
"All signs point towards a move back above $1,485 on the
February contract, which could be enough to push it above
Trump said a trade deal with China might be delayed until
after the November 2020 elections, dashing hopes that an
agreement could be reached before another round of tariff hikes
take effect on Dec. 15.
Gold prices have gained nearly 15% this year owing to the
protracted tariff dispute, which has fanned recessionary fears
and prompted central banks around the world to ease interest
Risk appetite was also hit on Monday after Trump tweeted he
would slap tariffs on Brazil and Argentina for what he saw as
both countries' "massive devaluation of their currencies."
Further dampening risk sentiment, Washington also threatened
duties on French goods because of a digital services tax imposed
by France that could harm U.S. tech companies, to which France
and the European Union said they are ready to retaliate, if
those threats were to materialize.
Most other precious metals latched on to gold's rally, with
silver gaining 1.6% to $17.17 per ounce, its highest
since Nov 22. Platinum was up 1.4% at $910.
"If gold and silver heat up over the next year (because of
an extended trade war), platinum will naturally get pulled in.
Palladium, on the other hand, is a little too high on a lot of
supply concerns," Haberkorn said.
Palladium edged 0.1% higher to $1,854.03, after
notching a record high of $1,861.71 in the previous session.
"How high palladium can go depends on how much the car
makers are willing to pay for steady supply of the metal," Saxo
Bank analyst Ole Hansen said.
"However, these multiple record highs may lead to a
correction soon, and we may see palladium hitting $1,800 before
it gets a chance to hit the $1,900 range."
(Reporting by Karthika Suresh Namboothiri in Bengaluru; Editing
by Jonathan Oatis and Andrea Ricci)
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