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PRECIOUS-Gold prices inch up as dollar eases despite trade dispute

Published 2018-09-18, 09:20 p/m
© Reuters.  PRECIOUS-Gold prices inch up as dollar eases despite trade dispute
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BENGALURU, Sept 19 (Reuters) - Gold prices edged up on Wednesday as the dollar weakened despite another round of tit-for-tat tariffs in the Sino-U.S. trade dispute.

FUNDAMENTALS

* Spot gold XAU= had climbed 0.1 percent to $1,199.18 an ounce by 0044 GMT.

* U.S. gold futures were up 0.1 percent at $1,203.70 an ounce.

* The dollar index .DXY , which measures the greenback against a basket of six major currencies, was down 0.1 percent.

* China and the United States plunged deeper into a trade war on Tuesday after Beijing added $60 billion of U.S. products to its import tariff list in retaliation for President Donald Trump's planned levies on $200 billion worth of Chinese goods. Asian stocks rose and U.S. Treasury yields hovered near four-month highs on Wednesday, as investors looked past the latest escalation in the U.S.-China trade conflict, seen by some market participants as less severe than expected. MKTS/GLOB

* Previous developments in the U.S.-China trade conflict had prompted investors to buy the U.S. dollar in the belief that the United States has less to lose from the dispute, making dollar-priced gold more expensive for non-U.S. buyers.

* The U.S. Senate voted overwhelmingly on Tuesday to pass a mammoth spending package including $675 billion for the Defense Department and a measure to keep the entire federal government open until Dec. 7, a step toward avoiding a Sept. 30 shutdown. Bond traders are increasing bets the Federal Reserve will raise U.S. short-term interest rates into 2019 as the jobs market tightens and with inflation seen climbing above its 2 percent goal. Business and political leaders are increasing the pressure on Canadian Prime Minister Justin Trudeau to agree on a deal to renew NAFTA and drop his insistence that no deal is better than a bad deal. The Bank of Japan is expected to keep monetary policy steady on Wednesday and maintain its optimistic view on the economy, even as escalating global trade frictions threaten to chill growth. Prime Minister Theresa May said Britain and the European Union were nearing a divorce deal but called on the bloc to show "goodwill and determination" to avoid a disorderly Brexit and secure a close future partnership. European Union leaders will discuss how to wind up negotiations with Britain on its withdrawal from the EU when they meet in Austria on Thursday, summit chair Donald Tusk said on Tuesday. Holdings in SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, fell 0.04 percent to 742.23 tonnes on Tuesday. GOL/ETF

* Precious metals producer Sibanye-Stillwater SGLJ.J said on Tuesday it remained fully committed to a takeover of platinum miner Lonmin LMI.L after South Africa's competition watchdog imposed conditions on the deal. AHEAD (GMT)

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