LONDON: Gold prices fell on Wednesday as a stronger dollar outpaced concerns over US-China trade talks, which had earlier boosted the metal’s safe-haven appeal.

The dollar, in which gold and other commodities are priced, rose versus a basket of currencies as investors awaited the release later in the day of minutes from the Federal Reserve’s latest policy meeting. But the greenback was on the back foot against the euro and the Japanese yen due to the broader risk aversion that had earlier benefited gold.

Gold is highly sensitive to rising US rates, as these tend to boost the dollar. The precious metal, often used to store wealth in times of political or economic uncertainty, was underpinned by safe-haven support after US President Donald Trump said he was not pleased about recent talks with China.

Spot gold had fallen 0.1 per cent to $1,288.98 per ounce by 1400 GMT, after touching its highest since May 15 at $1,297.84. US gold futures for June delivery were down 0.3pc at $1,288 per ounce. Prices remained in a narrow range, just below $1,300 per ounce, as investors awaited more clues on the path of US interest rates. Gold has shown reduced volatility in the last few trading sessions as it attempted a break above $1,300 and prices are “waiting for a new, clear direction,” said ActivTrades chief analyst Carlo Alberto De Casa. Holdings of the world’s largest gold-backed exchange-traded fund (ETF), New York-based SPDR Gold Shares , fell 0.38pc to 852.04 tonnes on Monday from 855.28 tonnes on Friday.

Silver fell 1pc to $16.35 an ounce and platinum was 0.2pc lower at $900.80 an ounce. Palladium eased 2.2pc to $969 an ounce.

Published in Dawn, May 24th, 2018