Gold prices declined in domestic futures trade on October 22 as progress in trade talks between the Washington and Beijing lifted risk-on sentiment.
Gold December futures fell marginally by Rs 26 to Rs 37,864 per 10 gram at 0940 hrs. In the global market, Spot gold was down 0.1 percent at $1,482.41 per ounce.
The US President Donald Trump said on Monday that US-China trade talks were making progress, adding to a comment he made on Friday that a trade deal will be signed by the time the Asia-Pacific Economic Cooperation meetings that take place in Chile on November 16-17, said a Reuters report.
Spot Gold prices hit $1,480 on Monday in the international market after a positive remark from the US President Donald Trump on trade talks with China.
Positive remarks on trade talk and possibility of scraping Chinese tariffs to be levied from December pushed S&P 500 at new high and eased safe-haven buying in gold, suggest experts.
Experts are of the view that Gold and Silver prices are likely to remain under pressure, and any bounce towards 38,000 could be used to create short positions.
“Prices at the domestic market slipped below Rs 38,000 and tested its crucial support of Rs 37,880. We expect gold prices remain in pressure as US-China trade talk is in a good direction,” Manoj Kumar Jain, Director at IndiaNivesh Commodities.
“Gold could test 37,800-37,700 in the domestic market. Any bounce towards 38,050 will be an opportunity to short in the domestic market for intraday for the target of 37,800-37,700 with a stop loss of 38,220,” he said.
Spot gold was little changed at $1,484.12 per ounce as of 0423 GMT. U.S. gold futures shed 0.1% to $1,487.10 per ounce.
China and the United States have achieved some progress in their trade talks, Chinese Vice Foreign Minister Le Yucheng said on Tuesday, adding that as long as both sides respected each other, no problem could not be resolved.
Le’s comments came a day after U.S. President Donald Trump spoke of optimism about a deal, while White House adviser Larry Kudlow said tariffs on Chinese goods scheduled for December could be withdrawn if talks go well.
This cheered markets and pushed the benchmark S&P 500 stock index within striking distance of a record high on Monday. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.1% on Tuesday.
“Equities markets are in a risk-on mode, and there seems to be a lack of support for gold prices and precious metals,” said Margaret Yang Yan, a market analyst at CMC Markets, adding that fears of a no-deal Brexit had ebbed and progressing U.S.-China trade talks gave markets some relief.
In the latest on the Brexit proceedings, British Prime Minister Boris Johnson’s parliamentary battle starts again on Tuesday, when lawmakers will debate and vote on the Withdrawal Agreement Bill, the detailed legislation that puts his exit deal into British domestic law.
“The (slip in prices) does not mean gold will continue to decline, because the market sees the Fed cutting another 25 basis points in its October meeting. For now it still looks like a healthy correction,” Yan said
Investors await a U.S. Federal Reserve meeting at the end of the month that could offer further signs of monetary easing. Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
Amongst other precious metals, silver slipped 0.1% to $17.55 an ounce, snapping a four day gaining streak. Platinum dropped 0.5% to $883.36 and palladium gained 0.6% to $1,768.63 an ounce.
