Gold Prices Retreat in Tuesday Trade, Receding from $1,216 on Monday

Alex Hamilton  |

Gold prices rallied to start the day on Monday. Fluctuations in the precious metal continued on Tuesday, as the United States dollar extended losses on Tuesday. The country’s currency, when compared against a basket of other currencies, fell to a one-month low despite global trade tensions easing.

The United States and Mexico announced that they reached a deal to overhaul the North American Free Trade Agreement.

The Trump Administration dampened the announcement when Donald Trump stated that he may still put tariffs on Canadian autos and also wants concessions on dairy products. Trade talks between the United States and China made little progress to end the week last week, further dampening US and Mexico trade agreements.

Gold prices rose to $1,216 an ounce, as investors started to buy gold early on Monday before easing back by mid-morning Tuesday.

The softer greenback did little to move gold prices to start the day on Tuesday. Gold prices rely on the dollar, falling when the greenback rises and rising when the greenback falls. Bullion is traditionally more expensive for holders when the dollar rises.

Silver is also down to start the day, falling 0.36%. Copper remains strong, rising 1.02% on Tuesday.

U.S. consumer confidence data was released today. The index rose to a reading of 133.4 in August, a major increase from July’s reading of 127.9. Economists were expecting August’s reading to be just 126.6. Consumer confidence is at its highest level in 18 years.

Selling pressure has pushed December gold futures down 0.15%.

Gold prices remained flat from last week’s finish in London following business opening after the Bank Holiday. Shanghai hold edged higher on Tuesday but remains at lower-than-average levels.

Gold’s recent rebound seems to be losing ground following the unexpected rise in consumer confidence. The rise in confidence will give the Federal Reserve more reason to increase interest rates through the end of 2018.

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The precious metal has stabilized above the $1,200 mark since hitting 1-1/2-year lows in mid-August.

Copper prices are one of the only prices rising on Tuesday, as the precious metal is on the rebound. Trade negotiation progress and a weaker dollar may send copper rising throughout the week. Trade disputes between the US and China has generated headwinds for copper. United States demand for copper from China sits around 2%. High tariffs and a focus on “American made” goods may impact China’s economy as a result.

Platinum and palladium are both down on Tuesday.

DISCLOSURE: The author has no stake in the listed equities.

The views and opinions expressed in this article are those of the authors, and do not necessarily represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:

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