Gold dips as dollar advances after strong U.S. data
By Aaron Saldanha
(Reuters) - The price of gold fell Tuesday as its safe haven was curbed by a strong dollar that contributed to gains following the release of strong US economic data amid the new coronavirus strain in the UK.
Spot gold fell 0.2% to $ 1,872.56 an ounce at 1038 a.m. EDT (1538 GMT), while U.S. gold futures fell 0.4% to $ 1,876.
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Bullion hit a six-week high of $ 1,906.46 on Monday, largely aided by the approval of a $ 892 billion coronavirus aid package in support of the pandemic-hit economy.
"While year-end gold prices are vulnerable to profit-taking as prices have risen over 20% this year, a number of risks persist in the face of tighter lockdowns and restrictions, new virus strains and Brexit negotiations," said Standard Chartered Analyst Suki Cooper said.
The dollar strengthened against a basket of peers backed by US economic data and weakened rivals weighed down by Brexit uncertainty.
Earlier data showed that the U.S. economy grew at a record pace in the third quarter, weighing on safe haven gold.
"Stimulus talks are behind us ... (but) I'm not very optimistic about gold right now. I don't think it has the firepower to break out," said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
"If the new strain makes its way into the US and re-infects people, it could really cause additional economic damage and be the next tailwind for gold."
For other metals, silver fell 1.5% to $ 25.76 an ounce, distancing itself from a more than three-month high in the previous session.
Platinum fell 0.1% to $ 1,008.01 and palladium rose 0.6% to $ 2,321.80.
(Reporting by Aaron Saldanha in Bengaluru; Editing by Nick Macfie)
In this article
GC = F.
ZG = F.
PL = F.
SI = F.
ZI = F.
PA = F.
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