Gold price falls on China tariff move, but set for a weekly gain
London (Dec 6) Gold prices slipped on Friday after China's announcement to waive import tariffs on some American goods, but bullion was still poised for a weekly gain ahead of a US jobs report that could offer further insight on the state of the economy.
Spot gold was down 0.2 per cent at $1,473.16 an ounce at 0802 GMT. US gold futures fell 0.3 per cent to $1,478.00.
Despite some losses, bullion is still headed for a second straight weekly gain, up about 0.7 per cent for the week so far. The metal hit a one-month high of $1,484 an ounce on Wednesday.
"This week gold continued to march on the higher side and today we can see some profit booking," said Ajay Kedia, director at Kedia Advisory in Mumbai, adding that China's move on Friday was pressuring prices further.
China's finance ministry said that import tariffs for some pork and soybeans from the United States will be waived, indicating a positive move to de-escalate the trade war ahead of US tariffs on Chinese goods effective from Dec. 15.
US President Donald Trump also said on Thursday that the trade talks were "moving right along" but some in the market remained cautious.
"We have seen US and China taking one step at a time and then we see that the deal is not going on - every time there is a new twist in the deal. So, unless this deal doesn't close, uncertainty will prevail in the market," Kedia added.
The positive comments supported Asian stocks, weighing on bullion, which is favoured in times of political and financial uncertainty.
"If the trade talks break down, then the price could spike up. Otherwise, we (expect gold to continue consolidating towards the year-end," said Margaret Yang Yan, a market analyst at CMC Markets.
"It's completely different from earlier in the year when gold was absolutely the star."
Bullion has gained 15 per cent so far this year, which could be its biggest annual rise since 2010, mainly due to the trade war.
Traders are now bracing for the US non-farm payrolls report due later on Friday to determine how well the US economy is holding up, after a series of weak US economic data reports.
In other precious metals, palladium was unchanged at $1,871.34, having notched a record high of $1,876.54 an ounce on Thursday on supply concerns for the auto catalyst metal.
Platinum was flat at $896.63, while silver fell 0.3 per cent to $16.89. Both were headed for their first weekly decline in four.
ETmarkets
