Investing.com - Gold prices rose on Tuesday after the Group of Seven wealthy nations issued a statement expressing concern about monetary policies, which markets interpreted as a thinly veiled message to Japan not to actively devalue its currency.
The news weakened the dollar, which trades inversely from gold though hopes the global economy will gain steam this year capped gold's gains.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery were up 0.05% at USD1,649.85 a troy ounce in U.S. trading on Tuesday, up from a session low of USD1,639.65 and down from a high of USD1,653.65 a troy ounce.
Gold futures were likely to test support USD1,626.05 a troy ounce, the low from Jan. 4, and resistance at USD1,670.25, Monday's high.
Earlier, a G7 statement warned member nations not to use monetary policy to push currencies weaker, leaving markets edgy over concerns was brewing over the yen's weakening trend.
"We, the G7 Ministers and Governors, reaffirm our longstanding commitment to market determined exchange rates and to consult closely in regard to actions in foreign exchange markets. We reaffirm that our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic objectives using domestic instruments, and that we will not target exchange rates," the G7 said on the Bank of England web site.
"We are agreed that excessive volatility and disorderly movements in exchange rates can have adverse implications for economic and financial stability. We will continue to consult closely on exchange markets and cooperate as appropriate."
The statement came ahead of G20 meeting scheduled to kick off Friday likely focus on competitive currency policies.
Japanese Finance Minister Taro Aso insisted on Tuesday that Japan would tell the G20 that it intends to maintain monetary and economic policies aimed at beating deflation and is not out to actively devalue its currency.
Under Prime Minister Shinzo Abe, Japan has taken steps to allow the yen to weaken against other currencies as part of a plan to prioritize economic growth of keeping the consumer price index in a tight target range.
The G7's statement sent the dollar falling as investors snapped up the yen, which sent gold gaining.
The precious metal's strengthening trend saw headwinds, however, on talk the global economy may pick up the pace of its recovery this year, which could prompt central banks to wind down monetary stimulus programs that weaken paper currencies as side effects.
Meanwhile on the Comex, silver for March delivery was up 0.24% and trading at USD30.983 a troy ounce, while copper for March delivery was up 0.56% and trading at USD3.744 a pound.
The news weakened the dollar, which trades inversely from gold though hopes the global economy will gain steam this year capped gold's gains.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery were up 0.05% at USD1,649.85 a troy ounce in U.S. trading on Tuesday, up from a session low of USD1,639.65 and down from a high of USD1,653.65 a troy ounce.
Gold futures were likely to test support USD1,626.05 a troy ounce, the low from Jan. 4, and resistance at USD1,670.25, Monday's high.
Earlier, a G7 statement warned member nations not to use monetary policy to push currencies weaker, leaving markets edgy over concerns was brewing over the yen's weakening trend.
"We, the G7 Ministers and Governors, reaffirm our longstanding commitment to market determined exchange rates and to consult closely in regard to actions in foreign exchange markets. We reaffirm that our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic objectives using domestic instruments, and that we will not target exchange rates," the G7 said on the Bank of England web site.
"We are agreed that excessive volatility and disorderly movements in exchange rates can have adverse implications for economic and financial stability. We will continue to consult closely on exchange markets and cooperate as appropriate."
The statement came ahead of G20 meeting scheduled to kick off Friday likely focus on competitive currency policies.
Japanese Finance Minister Taro Aso insisted on Tuesday that Japan would tell the G20 that it intends to maintain monetary and economic policies aimed at beating deflation and is not out to actively devalue its currency.
Under Prime Minister Shinzo Abe, Japan has taken steps to allow the yen to weaken against other currencies as part of a plan to prioritize economic growth of keeping the consumer price index in a tight target range.
The G7's statement sent the dollar falling as investors snapped up the yen, which sent gold gaining.
The precious metal's strengthening trend saw headwinds, however, on talk the global economy may pick up the pace of its recovery this year, which could prompt central banks to wind down monetary stimulus programs that weaken paper currencies as side effects.
Meanwhile on the Comex, silver for March delivery was up 0.24% and trading at USD30.983 a troy ounce, while copper for March delivery was up 0.56% and trading at USD3.744 a pound.