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Saturday 17

November, 2018 2:09 PM



US dollar pressures gold to 6-month low

US dollar pressures gold to 6-month low

Gold has slipped more than one per cent to its lowest in 6-1/2 months ahead of a US holiday, and platinum headed to its lowest in nearly 10 years.

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By AAP 03.07.2018 08:41 AM

Gold has slipped more than one per cent to its lowest in 6-1/2 months ahead of a US holiday, and platinum headed to its lowest in nearly 10 years as the greenback strengthened and an ongoing US-European Union trade spat pressured precious metals.

Fears of a trade war between the United States and China have helped weaken China's renminbi, the Indian rupee and Japan's yen against the US dollar.

A strong dollar makes greenback-priced gold more expensive for holders of other currencies.

The dollar received another boost from better-than-expected US manufacturing data.

Its strength has helped to pressure spot gold by more than eight per cent from its April high of $US1,365.23.

Meanwhile, a deepening auto tariff spat between the United States and the European Union has caused more sales of autocatalyst metals platinum and palladium, traders said.

Spot gold was down 0.8 per cent on Monday at $US1,242.01 per ounce.

US gold futures for August delivery settled down $US12.80, or one per cent, at $US1,241.70 per ounce.

Platinum was down four per cent at $US814 an ounce after touching its weakest since December 2008 at $US804.

Platinum was headed for its worse one-day drop in more than 2-1/2 years.

The European Union has warned the United States that imposing import tariffs on cars and car parts would harm the US automotive industry and likely lead to counter-measures on $US294 billion of US exports.

"With the auto tariff threats, you will see it affect demand, so investors are selling platinum as a result," said John Caruso, senior market strategist at RJO Futures.

Car sales will likely plummet, said Dillon Gage's Walter Pehowich.

Silver was down 1.4 per cent at $US15.85 an ounce after hitting $US15.73, the lowest in 6-1/2 months.

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