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PRECIOUS-Gold hits near 1-month high as trade drag prompts safety buying

Published 04/12/2019, 06:48 pm
© Reuters.  PRECIOUS-Gold hits near 1-month high as trade drag prompts safety buying
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(Updates prices, adds comments)

* Trump says China trade deal may have to wait until next year

* Dollar hovers near one-month low, stocks extend losses

* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl

By Asha Sistla

Dec 4 (Reuters) - Gold prices rose to a near one-month high on Wednesday, as U.S. President Donald Trump's comments dampened hopes for a quick preliminary trade agreement with China, driving support for safe-haven assets.

Spot gold XAU= gained 0.3% to $1,482.02 per ounce by 0707 GMT, its highest since Nov. 7, while U.S. gold futures GCcv1 were up 0.2% to $1,487.90.

President Trump on Tuesday said a deal with China might have to wait until after the U.S. presidential election in November 2020. comments come shortly after he slapped tariffs on U.S. steel and aluminium imports from Brazil and Argentina. has benefited from strong safe-haven flows, equities tanked and the dollar fell as well. And, that's the reason why gold has risen overnight," said Jeffrey Halley, senior market analyst, Asia Pacific at OANDA.

"President Trump saying a trade deal may not happen until after the U.S. election next year and the passage of the second China bill in the House of Representatives will add to the extreme trade worries because the fear is - China might just walk away from any trade negotiations."

The U.S. House of Representatives approved a bill that would require Washington to toughen its response to China's crackdown on its Uighur Muslim minority, which investors fear can possibly deteriorate trade ties. hopes of a deal further, U.S. Commerce Secretary Wilbur Ross rejected any deadlines on a trade deal with Beijing and launched a fresh attack on telecoms giant Huawei HWT.UL . remarks prompted investors to reduce their exposure to risk, with Asian shares extending their losses, while the U.S. dollar hovered close to a one-month low, making gold more attractive. MKTS/GLOB USD/

Gold, which is seen as safe investment during times of political and economic stress, has gained about 15% so far this year, mainly due to the 17-month long trade dispute and its impact on the global economy.

"Bull-run in gold is expected to continue and it can touch the $1,500 level this week, and $1,520 in the week going forward," said Kunal Shah, head of research at Nirmal Bang Commodities in Mumbai, India.

Among other precious metals, palladium XPD= was flat at $1,855.39 per ounce, after scaling to an all-time peak of $1,861.71 on Dec. 2.

"Platinum and palladium are rallying because they have an industrial use and there's just a massive squeeze on the supplies," OANDA's Halley said.

Platinum XPT= advanced 0.3% to $912.46 per ounce and silver XAG= rose 0.4% to $17.22.

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