PRECIOUS-Gold flat after hitting 2018 low as dollar, Treasuries firm


Warning: This material has been prepared by a third party company, Reuters, which is independent of Davy. Davy has not reviewed the material and accepts no responsibility for errors or omissions, or for the information or opinions contained therein. It does not constitute investment advice.

    * U.S. 10-year Treasury yield touches seven-year high
    * Platinum slips to lowest since mid December
    * GRAPHIC-2018 asset returns:

 (Recasts; updates prices, headline; adds comment, second
byline, NEW YORK to dateline)
    By Renita D. Young and Jan Harvey
    NEW YORK/LONDON, May 17 (Reuters) - Gold was flat after
sliding to a fresh 2018 low on Thursday as another rise in U.S.
bond yields and concerns over political risk in Italy held the
dollar index near its 2018 peak.
    The precious metal has fallen more than 2 percent this week
on gains in the U.S. currency and a rise in U.S. 10-year
Treasury yields to seven-year highs. Higher yields increase the
opportunity cost of holding non-yielding assets such as bullion.*:nL5N1SO4QT
    But gold got some support from geopolitical strife in North
    Spot gold  XAU=  was flat at $1,290.51 per ounce by 1:37
p.m. EDT (1737 GMT), off an earlier 4-1/2-month low of
$1,285.41. U.S. gold futures  GCv1  for June delivery settled
down $2.10, or 0.2 percent, at $1,289.40 per ounce. 
    The dollar has climbed nearly 4 percent this quarter on
expectations the U.S. Federal Reserve will lift U.S. interest
rates further this year to curb inflation, at a time when other
central banks are still keeping monetary policy loose.  FRX/ 
    "The dollar and the interest rates are what's really driving
gold," said Chris Gaffney, president of world markets at
    "Gold has further down to go, because the dollar has room to
go higher."
    The euro remains under pressure, hovering near a five-month
low on concerns that political developments in Italy could cause
wider disruption in the common currency bloc.*:nL5N1SMA1R
    Political uncertainty arising out of North Korea after
Pyongyang threatened to pull out of a meeting with the United
States was likely to limit downside for gold, analysts said.*:nL3N1SN1QK 
    Market watchers, unsure if the U.S. Federal Reserve will be
able to aggressively hike rates and concerned about political
uncertainty, lent support to gold prices, said Ryan McKay,
commodity strategist at TD Securities. 
    But gold "still remains vulnerable to the prevailing dollar
and rate headwinds," INTL FCStone said in a note.
    From a technical perspective, gold prices were looking
vulnerable to further losses after breaking below key chart
levels this week, according to analysts who study past price
moves to determine the future direction of trade.
    "Gold has eroded key support, namely the 200-day moving
average, the $1,302.74 March low and the 50 percent retracement
(of the December-to-January rally)," Commerzbank said in a note
on technicals. "We have been forced to neutralize our outlook as
the market is now on the defensive."
    Meanwhile, silver  XAG=  increased 0.6 percent to $16.44 an
    Platinum  XPT=  gained 0.4 percent to $890.80 per ounce, off
an earlier five-month low of $879, while palladium  XPD= 
declined 0.6 percent to $977.47.

 (Additional reporting by Apeksha Nair in Bengaluru
Editing by Edmund Blair and Bernadette Baum)
 ((; 1 646 223 8699; Twitter: @RenitaDYoung

Warning: This content may be provided by regulated and unregulated entities and is not created, reviewed or endorsed by Davy. It is provided for general information purposes only and does not constitute a recommendation or solicitation to purchase or sell any security or make any other type of investment or investment decision. Importantly, it does not constitute investment advice, as it does not contemplate the personal circumstances of any particular person or group of persons. Neither Davy nor the providers of the Third Party Content will be liable for any investment decision made based on the reliance on or use of such data, or any liability that may arise due to delays or interruptions in the delivery of the Third Party Content for any reason.