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Gold falls ahead of U.S.-China trade deal on improved risk appetite

Tuesday,   14-Jan-2020   09:58 AM (IST)

Gold fell on Tuesday, as investors opted for riskier assets after the United States dropped China's designation as a currency manipulator ahead of an interim deal between the two sides to ease their trade dispute. Spot gold dipped 0.7% to $1,537.67 per ounce by 0126 GMT. U.S. gold futures fell 0.9% to $1,537.10. Global equities rallied to reach fresh record highs as the world's two biggest economies prepare to formalise a truce. U.S. Trade Representative Robert Lighthizer said that the Chinese translation of the deal was almost completed and would be made public on Wednesday, just prior to a signing ceremony. The U.S. Treasury on Monday said China should no longer be designated a currency manipulator in a long-delayed semi-annual urrency report, reversing its August finding; the decision coincided with the arrival of a high-level Chinese delegation for a trade deal signing. However, a senior U.S. Chamber of Commerce official said, the deal "stops the bleeding" but is not an end to the trade war as significant challenges remain. Meanwhile, the dollar index held steady against a basket of rivals, making gold expensive for holders of other currencies.  U.S. Federal Reserve officials may broadly agree that interest rates are unlikely to change soon, but they differed Monday on how concerned they are about developing financial risks in assessing when a rate hike might be appropriate. Resolute Mining Ltd said on Monday it entered into talks with private equity fund EMR Capital Management Ltd to sell its Ravenswood gold mine in Australia for up to A$300 million ($207 million). Elsewhere, palladium fell 0.3% to $2,126.26 an ounce. Silver was down 1% to $17.79 per ounce, while platinum  slipped 0.6% to $967.78.