Gold Fell As US Greenback Gained Strength For Third Consecutive Session

Gold prices dropped on Wednesday morning as the dollar firmed against the yuan after the United States threatened to impose additional tariffs on Chinese goods, escalating trade tensions between the world’s two largest economies.
Colin First

While dovish NFP data resulted in US dollar taking a bearish hit, the greenback has managed to slowly but steadily regain its strength and has been moving up against major global counterparts for the third consecutive session as visible from a look at daily charts. XAUUSD pair is currently trading at $1253.19 with 0.19% decrease in value.

The Trump administration raised the stakes in its trade dispute with China, threatening 10 percent tariffs on a list of $200 billion worth of Chinese imports. The news comes after Washington imposed 25 percent tariffs on $34 billion of Chinese imports last week. Beijing responded immediately with matching tariffs on the same value of U.S. goods exported to China. U.S. gold futures for August delivery were 0.3 percent lower at $1,252.30 an ounce.

A firmer greenback makes bullion expensive for holders of other currencies as the commodity is priced in dollars. It’s risk-off and that put the dollar on the front foot and triggered commodities lower. However Silver has remained on neutral stance with the price of XAGUSD pair currently above $16 mark. While safe-haven precious metals lack demand the pair has managed to hold its price level as the selling activity surrounding silver has been very less across the week.

Gold Hourly

Oil prices cooled on Wednesday after US secretary of state Mike Pompeo said oil sanctions waivers may be granted to countries seeking relief from tough White House measures against Iran set to start in November. Brent crude, the international benchmark, was down 1.3% at $77.83 a barrel in early Asia-Pacific trading.

West Texas Intermediate, the key US price, shed 0.9 % and is trading at $73.49 per barrel. Mr. Pompeo’s comments marked the first time a senior administration official has said the US could waive sanctions, in the wake of efforts from a series of US teams dispatched by Washington to more than a dozen countries to seek their compliance with sanctions that are aimed at pressuring the regime in Tehran. China, India, and Turkey are among oil importers that have suggested they may not heed US measures. And the top US diplomat stressed that any country not granted waivers would still be liable for hefty penalties.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.