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Gold rises on weaker dollar; focus diverts to US-China talks

Gold rises on weaker dollar; focus diverts to US-China talks

Mubasher: Gold prices went up on Thursday as the US dollar traded close to a one-week low hit in the prior session, as markets anticipated development on the trade negotiations between the US and China, according to Reuters.

By 9:00 am GMT, US gold futures ticked up 0.01% to $1,295.40 per ounce, spot gold inched up 0.09% to $1,291.03 per ounce.

“There is a lot of optimism around the idea that we will see a peaceful resolution and some agreement really soon,” CMC Markets chief market strategist Michael McCarthy was quoted by the news agency.

Trade negotiations between the world’s biggest two economies saw a “good headway” last week in Beijing and both sides look to bridge differences in future meetings, White House economic adviser Larry Kudlow was quoted by Reuters as saying on Wednesday.

This came along as the Financial Times (FT) reported that both sides are close to clinching a final trade deal.

Any positive progress in the US-Sino trade affairs usually weighs on the dollar, which has been the favourite safe-haven asset over the year-long spat between the world’s biggest two economies.

The greenback traded near its lowest level in the previous session following a report showing that the US service sector activity shrank, hitting a more than 19-month trough last March, and data indicating a less-than-expected growth in private payrolls.

This weighed on the US currency, making the yellow metal more affordable to non-US currency holders.

At 9:01 am GMT, the US dollar index, which gauges the greenback against six major rivals, edged up 0.06% to 97.1450.

“However, if the trade talks drag out we could see further support for gold because of its implications on growth,” McCarthy said.