Gold Rises on Weak Dollar
By Investing.com | April 10, 2018 10:53 AM EST
Gold was higher on Tuesday, driven by a weaker U.S. dollar and geopolitical tensions in Syria.
The price of the precious metal rose as the greenback reached a two-week low. The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.25% to 89.31 as of 10:52 AM ET (14:52 GMT).
Comex gold futures for June delivery rose 0.21% to $1,342.90 a troy ounce.
Gold is denominated in the U.S. currency and becomes more expensive for holders of other currencies when the dollar rises.
Geopolitical tensions in the Middle East have also bolstered bullion.Investors are worried that U.S.-Russia relations could deteriorate amid the heightened uncertainty after a suspected chemical attack. On Monday U.S. President Donald Trump said he would decide how to respond to the attacks by Wednesday, indicating a potential military response.
Investors seek out gold as a store of value during times of geopolitical uncertainty or market turmoil, while a weaker dollar makes the dollar-denominated metal cheaper for holders of other currencies.
Meanwhile, Chinese President Xi Jinping reiterated comments on Tuesday that he would open the country’s economy and lower import tariffs on automobiles. He also promised to enforce the legal intellectual property of foreign firms, which was a point of contention for Trump. The comments helped soothe investor worry over an escalating trade war between the two countries.
Elsewhere on the Comex, silver futures were up 0.43% to $16.600 a troy ounce. Among other precious metals, Platinum Futures fell 0.75% to $932.40, while Palladium Futures rose 1.91% to $950.30 an ounce. Copper futures surged 1.79% to $3.132 a pound.