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Gold prices dip in Asia, but supported by Ukraine events

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Investing.com -

Investing.com - Gold prices eased in early Asia on Monday, but remained supported by events in the Ukraine where pro-Russian separatists in eastern Ukraine appeared to be on track to declare victory in a referendum Sunday that Kiev and the West say is illegal and riddled with irregularities.

The vote ratchets up tensions between the Kremlin, which may recognize the vote, and the nascent government in Kiev, which is struggling to regain control of the two provinces that it says Moscow is destabilizing through support of rebels.

On the Comex division of the New York Mercantile Exchange, gold for June delivery traded at $1,283.70 a troy ounce, down 0.30%, after settling last week at $1,287.60.

Last week, gold futures ended modestly lower, as a broadly stronger U.S. dollar dampened the appeal of the precious metal.

The U.S. dollar rallied to a one-month peak against the euro on Friday, extending steep gains from the previous session after the European Central Bank indicated that it could ease monetary policy as soon as next month.

The U.S. Dollar Index, which tracks the performance of the greenback against a basket of six other major currencies, advanced 0.57% on Friday to end the week at 79.92, the most since April 30.

A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.

Gold, seen as a safe haven investment, usually benefits from geopolitical turmoil.

On the week, Comex gold retreated 1.17%, or $15.30 an ounce. Gold fell to $1,284.80 an ounce on Thursday, the lowest since May 2 following upbeat comments on the economy from Federal Reserve Chair Janet Yellen.

In the week ahead, investors will be looking to U.S. data on retail sales, consumer prices and consumer sentiment for further indications on the strength of the economy and the need for stimulus.

Also on the Comex, silver for July delivery eased down 0.09%, or 1.7 cents, on Friday to settle the week at $19.12 a troy ounce, the weakest level since May 2. Silver dropped 1.05%, or 20.4 cents, on Thursday to end at $19.13 an ounce.

Elsewhere in metals trading, copper for July delivery added 0.67%, or 2.0 cents, on Friday to settle the week at $3.083 a pound by close of trade.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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