Investing.com - The trade war update is getting more colorful by the day. President Donald Trump’s comment that the United States was in the “final throes” of a trade deal with China delivered another knock to gold on Wednesday as fewer investors saw the need to hedge amid a surge in risk-taking.
Both bullion and gold futures fell after the previous day’s rise as stocks on Wall Street flew to record highs after their open.
Gold futures for February delivery on New York’s COMEX settled down $6.60, or 0.4%, at $1,460.80 per ounce. The contract plumbed $1,456.60 in the previous session — a bottom since Nov. 8 — before recovering.
Spot gold, which tracks live trades in bullion, slid $6.04, or 0.4%, to $1,455.16 by 3:05 PM ET (20:05 GMT).
COMEX volumes in gold were also lighter than usual with fewer traders on their desks or taking positions actively ahead of Thursday’s Thanksgiving holiday.
“Gold is in pull-back mode today, trading more like a currency, as it awaits a break on the China-U.S. tariff news,” said George Gero, precious metals analyst at RBC Wealth Management in New York.
Both bullion and gold futures climbed from two-week lows on Tuesday, taking in their stride the fact that China’s commerce ministry said Vice Premier Liu He held talks over the phone — again — with U.S. Trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on issues related to the phase one trade agreement.
Each time the three officials spoke over the past month, markets have got their hopes up that the phase one was a done deal — only to realize later it wasn’t.