Gold Edges Up Ahead Of G20 Meeting; Set To Post Second Weekly Gain
President Xi Jinping is due to hold talks with U.S. President Donald Trump at the G20 meeting that starts on Nov. 30 in Argentina to reconcile their trade dispute
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Gold prices inched up today, set to rise for the second straight week, on safe-haven demand for the metal ahead of the G20 summit next week where the leaders of the United States and China are set to discuss their trade dispute.
Spot gold was up 0.1 percent at $1,227.90 per ounce at 0439 GMT. The yellow metal was up around 0.5 percent after a 1 percent gain last week. U.S. gold futures edged 0.1 percent higher at $1,228.9 per ounce.
President Xi Jinping is due to hold talks with U.S. President Donald Trump at the G20 meeting that starts on Nov. 30 in Argentina to reconcile their trade dispute.
The U.S. is set to raise its tariffs to 25 percent on $200 billion of Chinese imports on Jan. 1 from 10 percent currently. Trump has also threatened to impose tariffs are all Chinese imports unless U.S. demands are addressed.
"Investors are stepping in to hedge some of the possible tail risk from the G20 meeting next week," said Stephen Innes, APAC trading head at OANDA in Singapore, adding the weaker dollar and U.S. Federal Reserve's rate outlook are also supporting gold prices.
The dollar index, which measures the greenback against a basket of six major currencies, fell and is drifting lower after reaching a 16-month high of 97.69 earlier this month. The dollar declined as a potential global economic slowdown raised doubts about the pace of interest rate increases by the Fed next year.
"A good sizeable portion of the investment community is looking to position long on gold and that has compounded with the fact that the Fed has turned somewhat dovish," Innes said. Investor interest in bullion was reflected in holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, which rose on Wednesday to their highest since the end of August.
Spot gold may test a support at $1,211 per ounce, as it is peaking around a resistance at $1,231, according to Reuters technical analyst Wang Tao. Among other precious metals, silver was up 0.3 per cent at $14.50 an ounce, while platinum edged 0.1 per cent lower at $843.30 per ounce.
Palladium was down 0.2 per cent at $1,150.74 an ounce. The metal was headed for its biggest weekly percentage decline since the week of July 20, down about 2.3 per cent so far.