Gold dips but EM risk supports

Sept 4 (Reuters) – Gold prices inched down on Tuesday as the dollar hit a one-week high on the back of intensifying global trade tensions and economic worries in emerging markets.

Gold prices are down about 8 per cent this year amid rising U.S. interest rates, trade disputes and the Turkish currency crisis, with investors parking their money in the dollar which is being viewed as a safe-haven asset.

Spot gold was down 0.1 per cent at $1,199.20 an ounce at 0347 GMT, while U.S. gold futures had dropped 0.1 per cent to $1,205 an ounce.

“The emerging market economic crisis is making currencies very weak and benefiting the dollar, which continues to pressure gold,” said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.

Meanwhile, worries over an escalation in trade conflicts between the United States and other countries have kept participants in broader markets on edge.

“With all the noise building around the trade dispute, along with unsettling economic prospects for Turkey and Argentina that will likely drag on more emerging market economies … gold should be in demand,” said Stephen Innes, Asia-Pacific trading head at OANDA.

Reuters

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Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes