Gold prices fall on stronger dollar, equities

Monday,   19-Aug-2019   09:10 AM (IST)

Gold prices dipped on Monday on a stronger U.S. dollar and a recovery in equities markets, as hopes of stimulus from major central banks eased fears of a steep global economic downturn. Spot gold was down 0.5% at $1,506 per ounce at 0114 GMT. U.S. gold futures fell 0.4% to $1,517.60 an ounce. The dollar index, against a basket of six major currencies, hovered near a two-week high reached on Friday. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.25%. Wall Street shares rebounded on Friday after a report stated that Germany’s government would be prepared to take on new debt and launch stimulus steps to counter a possible recession. On Saturday, China’s central bank unveiled a key interest rate reform to help drive borrowing costs lower for companies, and support a slowing economy. Investors are awaiting the Federal Reserve’s Jackson Hole symposium this week. Traders see about a 69% percent chance of a 25 basis-point cut in September. SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.10% to 843.41 tonnes on Friday. Hedge funds and money managers trimmed their bullish stance in COMEX gold and cut net long positions in silver contracts in the week to Aug. 13, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday. Last week, high prices prompted Asian consumers to sell back physical gold to lock in profits.