Latest News

Irish News

Click Here to read Irish News

Forex News

Click Here to read Forex News

Market News

Click Here to read Market News

Irish News
/fxcentre/i-want-to/read-news
PRECIOUS-Gold drops below $2,000 as dollar holds gains and shares bounce
Published at 11/08/2020 at 12:04

* Gold's trajectory still positive -analysts

* Interactive graphic tracking global spread of coronavirus: open in an external browser

(Adds graphic, updates prices)

By Nakul Iyer

Aug 11 (Reuters) - Gold slid more than 2% on Tuesday as the dollar clung to recent gains and risk appetite was boosted by an expected U.S. stimulus deal, prompting investors to take profits from bullion's explosive run to a record high.

Spot gold fell 2% to $1,987.49 an ounce by 1053 GMT, retreating from last week's record high of $2,072.50. U.S. gold futures declined 2.1% to $1,996.40.

"The retreat was inevitable," said StoneX analyst Rhona O'Connell, adding that gold has been technically overbought for a while.

That gold did not advance further despite rising geopolitical tensions showed that a lot of supportive elements for gold have already been priced in, she said.

Adding to gold's headwinds, global equities hit multi-month highs on expectations that U.S. Congress will agree a massive stimulus deal while looming trade talks raised hopes of an easing in tensions between the United States and China.

The dollar, too, clung to recent gains, making gold less attractive for investors holding other currencies.

Beyond technical triggers, the fundamental reason for gold's moves is that the dollar weakness of the past few weeks has paused, said Saxo Bank analyst Ole Hansen.

But most analysts still expect a positive trajectory for gold, with the metal having gained 31% this year as unprecedented money printing by central banks and near-zero interest rates pushed investors into bullion as a hedge against possible currency debasement and inflation.

The recent "washout of speculative long positioning sets gold up for a more balanced rally going forward", said Jeffrey Halley, a senior market analyst at OANDA.

In other precious metals, silver fell 3.1% to $28.25 an ounce, platinum was down 1.5% at $971.90 and palladium

dropped 2.6% to $2,161.28.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Gold's hasty retreat Gold's correction overdue?

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

(Reporting by Nakul Iyer and Brijesh Patel in Bengaluru, Additional reporting by K. Sathya Narayanan and Arpan Varghese Editing by David Goodman)

((nakul.iyer@thomsonreuters.com; Within U.S. +1 646 223 8780, Outside U.S. +91 80 6749 0417; Reuters Messaging: nakul.iyer.thomsonreuters.com@reuters.net))