• Spot gold has risen off the previous day's near four-month lows, as a drop in equities drives safe-haven buying and the US dollar retreats.
Spot gold was up 0.23 per cent at $US1,216.79 per ounce by 3.08 pm Tuesday EDT (0508 Wednesday AEST), near Monday's $US1,204.45, its lowest since March 15. US gold futures for August delivery settled up $US1.5, or 0.12 per cent, at $US1,214.70 per ounce.
• US stocks and the US dollar reversed gains after US president Donald Trump's eldest son released an email chain which mentioned a top Russian government prosecutor offering the Trump campaign damaging information about Democratic rival Hillary Clinton.
• "The brief but sharp drop in equity markets caused safe-haven gold to bounce back this afternoon," said Fawad Razaqzada, a market analyst at Forex.com.
The weaker currency makes US dollar-denominated commodities less expensive for holders of other currencies, which could subdue demand. The greenback fell after hitting a four-month high against the Japanese yen on the past fortnight's 25-basis-point rise in 10-year US government bond yields.
•Traders awaited a speech from US Federal Reserve Chair Janet Yellen later this week and any signs of tightening of monetary policy from the central bank
• Gold prices are down more than 6 per cent from a seven-month high near $US1,300 hit in June.
• Perceptions that an era of ultra-cheap money is gradually ending have been reinforced by European Central Bank minutes showing policymakers are open to reducing monetary stimulus.
• The Bank of Canada is expected to raise rates on Wednesday. Yellen is scheduled to deliver a semiannual monetary policy testimony to lawmakers on Wednesday and Thursday.
• "Gold should recover from this latest pullback as the move higher in real rates is unlikely to be sustained and we see longer-term value around these levels," UBS analysts said in a note.
On the technical front, support for gold comes in at $US1,200 followed by $US1,195, near the low on March 10. Upside resistance comes in at the 200-day moving average near $US1,230.
• An investor retreat from gold can be seen in holdings of physically backed exchange-traded funds, which at 54.61 million ounces are down more than 1 per cent since June 14.
• Spot silver gained 1.09 per cent at $US15.80 per ounce, palladium was up 1.53 per cent at $US852.63 per ounce and platinum rose 1.58 per cent to $US853.05 per ounce.
Reference: Business News
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