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PRECIOUS-Gold holds gains on dollar weakness; Sino-U.S. trade in focus

Published 06/09/2018, 11:07 am
Updated 06/09/2018, 11:10 am
© Reuters.  PRECIOUS-Gold holds gains on dollar weakness; Sino-U.S. trade in focus
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BENGALURU, Sept 6 (Reuters) - Gold on Thursday held on to gains from the previous session, when it rose 0.5 percent, as the dollar remained weak amid a looming deadline in the U.S.-China trade conflict.

FUNDAMENTALS

* Spot gold XAU= was up 0.3 percent at $1,199.21 at 0025 GMT.

* U.S. gold futures rose 0.3 percent at $1,204.90 an ounce.

* The dollar index .DXY , which measures the greenback against a basket of currencies, was down 0.3 percent at 94.949.

* The greenback slipped on Wednesday after a report that Germany would be ready to accept a less detailed agreement on the UK's future economic and trade ties with the EU in a bid to get a Brexit deal done. That boosted the pound and the euro. FRX/

* Meanwhile, trade concerns continued to keep investors nervous, with a deadline looming in the U.S.-China trade dispute and a refusal by Canada to bow to key U.S. demands in its trade talks with Washington. The United States and Canada resumed talks about revamping the North American Free Trade Agreement (NAFTA). Canada insisted there was room to salvage the pact despite few signs a deal was close. U.S. President Donald Trump said talks with Canada were coming along. Gold has fallen about 8 percent this year amid rising U.S. interest rates, trade disputes and the Turkish currency crisis, with investors parking their money in the dollar.

* Emerging market currencies remained weak, on fears export-oriented economies would be caught in the crossfire of any escalating trade conflict. The MSCI EM Currency Index .MIEM00000CUS was down 0.16 percent, after slipping to its lowest since May 2017 earlier in the session.

* The emerging market crisis could boost gold's appeal as a safe haven asset as people might buy the yellow metal as a hedge against inflation, analysts say.

* Spot gold is expected to be range-bound between $1,160 and $1,238 per ounce over the next four weeks, as suggested by its wave pattern and a projection analysis, according to Reuters technical analyst Wang Tao. India's gold imports more than doubled in August to hit their highest level in 15 months as lower prices prompted manufacturers to replenish inventory for a jewellery exhibition, provisional data from metals consultancy GFMS showed.

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