US Markets

Gold scales over 1-week peak on rising global trade tensions

Credit: REUTERS/EDGAR SU

Gold rose to a more than one-week high on Tuesday after U.S. President Donald Trump ratcheted up trade tensions with China, Brazil and Argentina, pushing investors to safe havens, while scarce palladium held near a record peak.

(Updates prices) * China deal may be delayed until after U.S. elections - Trump * Palladium may be bound for a correction - analyst * SPDR Gold holdings fall to lowest since Sept. 19 * Specs cut bullish positions in gold, raise silver - CFTC By Diptendu Lahiri Dec 3 (Reuters) - Gold rose to its highest in more than a week on Tuesday after U.S. President Donald Trump ratcheted up trade tensions with China, Brazil and Argentina, pushing investors to safe havens, while palladium held near a record peak. Spot gold was up 0.7% at $1,472.86 an ounce by 1330 GMT, after hitting its highest since Nov. 21 at 1,473.40 earlier in the session. U.S. gold futures were 0.7% higher at $1,478.90 per ounce. "Credit goes to the tariff man (Donald Trump) for the slightly higher movement we're seeing," said Saxo Bank commodity strategist Ole Hansen. Trump on Monday announced tariffs on U.S. steel and aluminium imports from Brazil and Argentina "effective immediately", opening new fronts in his trade war. [nL8N28C2M8] The U.S. President also said a trade agreement with China might have to wait until after the U.S. presidential election in November 2020. [nL8N28D2KI] [nL9N27702E] "The effect of any news around the trade war is getting lesser and lesser with each time we have one and there seems to be no other catalyst on the horizon to break the narrow range," Hansen added. Gold has risen about 14% so far this year, mainly due to the 17-month-old trade dispute, but has been trading in a $1,444-$1,478 range since November. Also propping up bullion, weak U.S. manufacturing data on Monday dented some optimism over global economic growth after China's factory activity unexpectedly expanded at the quickest pace in almost three years in November. [nZUN83QI03][nL1N2890MD] On the technical front, the metal continues to hold rangebound heading into year-end, MKS PAMP said in a note. Gold is "seemingly well supported around $1,450 (but) lacking any meaningful demand to break top-side resistance through $1,465-$1,470 and $1,480, the key level above this," it added. Holdings of the world's largest gold-backed ETF, SPDR Gold Trust , fell 0.7% to 889.16 tonnes on Monday, their lowest since Sept. 19. [GOL/ETF] Hedge funds and money managers cut their bullish positions in COMEX gold and raised them in silver contracts in the week to Nov. 26. [CFTC/] Elsewhere, palladium edged down 0.2% to $1,848.38 per ounce, having nearly matched an all-time peak of $1,861.71 scaled in the previous session. "How high palladium can go depends on how much the carmakers are willing to pay for steady supply of the metal," Saxo Bank's 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." Silver rose 0.7% to $17.03 and platinum was up 0.1% at $898.57 per ounce. (Reporting by Diptendu Lahiri in Bengaluru Editing by Alexandra Hudson and Jan Harvey) ((Diptendu.Lahiri@thomsonreuters.com; within U.S. +1 651 848 5832; outside U.S. +91 80 6749 3683;; Reuters Messaging: diptendu.lahiri.thomsonreuters.com@reuters.net)) Keywords: GLOBAL PRECIOUS/ (UPDATE 4, PIX)

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

Latest Markets Videos

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More