PRECIOUS-Gold falls as threat of more tariffs on China boosts dollar

Reuters

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. set to slap 10 pct tariffs on $200 bln of Chinese
goods
    * SPDR gold holdings fell 0.22 percent on Tuesday
    * Palladium falls to two-week low

 (Updates prices; adds comment, second byline, NEW YORK to
dateline)
    By Renita D. Young and Maytaal Angel
    NEW YORK/LONDON, July 11 (Reuters) - Gold prices slipped on
Wednesday as U.S. threat of tariffs on an additional $200
billion of Chinese goods pushed safe-haven flows to the U.S.
dollar and dashed hopes that Washington would eventually step
back from the escalating row.
    U.S. President Donald Trump detailed overnight a list of
Chinese products that could face 10 percent tariffs. The clock
now starts ticking on a two-month period of public comment
before the levies are imposed.  urn:newsml:reuters.com:*:nL4N1U71IM
    The news sent the U.S. dollar to an 11-month high versus the
yuan and hit the Australian dollar, but left the euro largely
unmoved. A strong greenback makes U.S. dollar-priced gold
costlier for non-American investors.  FRX/ 
    "Gold is feeling the pressure from commodities across the
board and the firmer dollar," said David Meger, director of
metals trading at High Ridge Futures in Chicago."
    Spot gold  XAU=  gained 0.9 percent at $1,243.57 per ounce
by 1:34 p.m. EDT (1734 GMT), earlier sinking to an eight-day low
of $1,242.55.
    U.S. gold futures  GCcv1  for August delivery settled down
$11, or 0.9 percent, at $1,244.40 per ounce. 
    "Gold options keep getting higher and higher, which means
people are positioned for prices to rise. It tells us there is
overhanging positive sentiment to gold but right now the money
is sitting on the sidelines," ING analyst Oliver Nugent said.
    The news of more possible U.S. tariffs on China is the
latest in a tit-for-tat spat between the world's two largest
economies.  urn:newsml:reuters.com:*:nL4N1U71IM
    Spot gold may break support at $1,247 per ounce and fall
more towards the next support at $1,237 as it has completed a
bounce from the July 3 low of $1,237.32, Reuters technicals
analyst Wang Tao said.  TECH/C 
    "When trade-war risk escalates, investors run for cover ...
I always have gold as a hedge but it's been more challenging to
have this view when the U.S. dollar is attracting haven flows,"
said Stephen Innes, APAC trading head at OANDA.
    Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Shares  GLD , fell 0.22 percent to 799.02 tonnes
on Tuesday.  GOL/ETF 
    In wider markets, global stock markets fell while metals
slumped to their lowest in a year on fears of a trade war.
Falling equities, seen as risky assets, usually help gold, a
traditional safe haven.  MKTS/GLOB 
    Silver  XAG=  shed 1.4 percent at $15.82 an ounce, while
platinum  XPT=  dropped 1.4 percent at $830.60. Earlier in the
session, both metals fell to their lowest since July 3.
    Palladium  XPD=  lost 0.2 percent at $939.50 per ounce,
after falling to a two-week low at $931.40.

 (Additional reporting by Karen Rodrigues; Editing by Bernadette
Baum)
 ((Renita.Young@tr.com; 1 646 223 8699; Twitter: @RenitaDYoung
twitter.com/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.