Precious Metals Preview: Gold Turns Lower, Broad Demand Worries Weigh

Gold slipped sharply yesterday as broad demand concerns and a splendid recovery in US equities hurt the metal. The commodity jumped earlier as fresh worries regarding global trade wars pushed up the safe haven buying for the metal. China plans new tariffs on 106 US products, according to media reports. Chinese officials said Wednesday that they plan to impose tariffs of up to 25% on American imports such as soybeans and cars. Equities came in steep selling pressure following this with the US equity indices futures witnessing heavy losses after the news. COMEX Gold gained quickly as a result, rallying nearly ten dollars within an hour. However, highs near $ 1350 yet again capped the upside and the metal tanked in US session once DOW edged up. COMEX Gold fell nearly 1% and extended the slide in Asia. The counter currently trades at $ 1332.20 per ounce, down 0.59% on the day. MCX Gold futures broke above Rs 31000 mark but dropped back and closed at Rs 30750 per 10 grams, up 0.40% on the day.

Global Gold demand will change little this year from 2017 levels as slim gains in physical investment and jewellery and industrial demand are partially offset by a drop in central bank buying to its lowest since 2010, according to an updat Metals Focus, noted media reports. Global gold demand is seen at 3,969 tonnes in 2018, up 1 per cent from last years levels but some 10 per cent below the average for the last five years.