Written by The Banking Post
Gold prices eased on Tuesday as investors locked in profits following the previous session’s strong rally, while a firmer US dollar added further pressure.
Spot gold fell 0.8 per cent to $5,189.99 an ounce by 0125 GMT, snapping a four-session winning streak after touching a more than three-week high earlier in the day. Bullion had surged 2.5 per cent in the prior session. US gold futures for April delivery were down 0.3 per cent at $5,210.40.
Analysts said the pullback reflected normal profit-booking after a sharp rise. They noted that while US equity markets saw panic-driven selling overnight, that anxiety did not fully spill over into Asian trading hours. The stronger dollar also weighed on prices, making dollar-denominated gold more expensive for holders of other currencies.
Asian shares wobbled early Tuesday after a Wall Street selloff unsettled investors. Sentiment has been dented by renewed uncertainty over US trade policy and escalating tensions between the United States and Iran.
The dollar edged higher after US President Donald Trump warned trading partners against stepping back from recently negotiated trade deals, saying higher duties could be imposed under alternative laws if agreements unravel.
On the monetary policy front, Federal Reserve Governor Christopher Waller indicated he would support keeping interest rates unchanged at the March meeting if upcoming labour market data show improvement following earlier weakness.
Markets are currently pricing in three 25-basis-point rate cuts this year, according to CME’s FedWatch Tool. Lower interest rates typically support non-yielding assets such as gold, but short-term currency strength and profit-taking have capped gains for now.
Among other precious metals, spot silver fell 1 per cent to $87.38 an ounce after hitting a more than two-week high on Monday. Platinum slipped 0.7 per cent to $2,139.25, while palladium edged up 0.3 per cent to $1,748.12.
