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PRECIOUS-Gold prices hold firm on trade, growth concerns

CommoditiesFeb 10, 2019 20:20
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© Reuters. PRECIOUS-Gold prices hold firm on trade, growth concerns

Feb 11 (Reuters) - Gold prices held steady on Monday, supported by uncertainties around Sino-U.S. trade war and concerns of slowing global economic growth, while a strong dollar weighed on the precious metal.

FUNDAMENTALS

* Spot gold XAU= was steady at $1,313 per ounce at 0059 GMT.

* U.S. gold futures GCv1 were also firm at $1,317 per ounce.

* World stocks .MIWD00000PUS ended last week in the red amid uncertainty about global economic growth and trade tensions, posting their first weekly drop this year. MKTS/GLOB

* Investors are looking ahead to trade talks this week with a delegation of U.S. officials travelling to China for the next round of negotiations. U.S. President Donald Trump said last week that he had no plans to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal. Trump has vowed to increase U.S. tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent currently if the two sides cannot reach a deal by 12:01 a.m. (0501 GMT) on March 2.

* Trade tensions between the two largest economies of the world have rattled financial markets since last year.

* Adding to investor worries was the collapse in talks between U.S. Democrat and Republican lawmakers over the weekend amid a clash over immigrant detention policy, raising fears of another government shutdown. The European Commission sharply downgraded euro zone growth this year and next. Tighter financial conditions since last September make further interest rate hikes seem much less necessary than just a few months ago, San Francisco Federal Reserve Bank President Mary Daly said on Friday. Federal Reserve Chairman Jerome Powell is expected to testify on U.S. monetary policy and the economy before the House Financial Services Committee on Wednesday.

* The dollar index .DXY was marginally higher and hovering near more than one-month highs touched in the previous session. USD/

* A stronger greenback makes dollar-denominated gold more expensive for holders of other currencies.

* Demand for physical gold in India rose last week as jewellers stocked up for a major exhibition, allowing dealers to cut discounts to the lowest in two months, while the Lunar New Year holiday kept activity subdued in other major Asian hubs. Scrap gold supplies in India, the world's second-biggest consumer of bullion, may increase this quarter as a rally in local gold prices has prompted consumers to sell old trinkets and jewellery. SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, saw outflows for five straight sessions last week. GOL/ETF

* Venezuela's most successful financial operations in recent years have not taken place on Wall Street, but in primitive gold-mining camps in the nation's southern reaches.

PRECIOUS-Gold prices hold firm on trade, growth concerns
 

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