August 17, 2021
Gold inches lower as firm dollar overshadows safe haven appeal
(Reuters) - Gold prices inched lower on Tuesday, as a firmer dollar outweighed safe-haven demand due to intensifying coronavirus Delta variant cases and ease in bets on early tapering by the U.S. Federal Reserve.
Spot gold fell 0.1% to $1,785.80 per ounce , lingering below an over one-week peak of $1,788.97 touched on Monday.
U.S. gold futures eased 0.1% to $1,788.00.
The U.S. dollar, also often seen as the ultimate safe-haven currency, was up 0.1%.
Stephen Innes, managing partner at SPI Asset Management, said that there seemed to be a little bit of demand for dollar but it was not really turning gold off completely because there was a possibility that the Federal Reserve would not push forward any taper agenda at the Jackson Hole symposium.
“However the upside in gold is going to be relatively limited,” he added.
Recent data showing sharp drop in U.S. consumer confidence and bigger-than-expecetd drop in New York Fed’s Empire State manufacturing business index have allayed some concerns of an early policy tightening by the Fed.
Focus is now on U.S. retail sales data due later in the day as well as the minutes of Fed’s July meeting on Wednesday for cues on the central bank’s stimulus tapering.
“The path of the virus remains central to Fed’s decision making and the minutes of the July meeting will provide further insights into the debate at the Fed on tapering,” ANZ Research said in a note.
Asian shares declined in early trade on growing anxiety over the spike in the Delta variant infections and turmoil in Afghanistan.
Among other precious metals, silver rose 0.1% to $23.85 per ounce, while platinum eased 0.2% to $1,020.69.
Palladium fell 0.1% to $2,603.51, after hitting a near one-month low in the previous session at $2,575.40.