Gold prices tumbled Wednesday, as the dollar added to gains, while the Trump administration's threat of further tariffs on Chinese goods roiled other metals as Copper sank to a nearly one-year low.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange fell by $10.60 or 0.37%, to $1,255.00 a troy ounce, hovering just above an intraday low of $1,247.80.
The White House issued a list late Tuesday of 10% tariffs on $200 billion worth of Chinese imports it will assess.
The threat of further U.S. tariffs on Chinese goods failed to garner investor demand for safe-haven gold, as dollar strength continued to keep a lid on the yellow metal.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.61% to 94.41 amid positive wholesale inflation data Tuesday.
As well as positive U.S. wholesale inflation data Tuesday, the U.S. Senate's approval of a motion to give Congress a role in reviewing President Donald Trump's decision to impose tariffs on national security grounds, also boosted the greenback.
Dollar-denominated commodities such as gold are sensitive to moves in the dollar. A rise in the dollar makes gold more expensive for holders of foreign currency, reducing demand for the precious metal.
Renewed trade-war concerns drew a large negative reaction from other metals as copper, zinc, aluminium and nickel fell sharply on expectations that a trade-war would limit demand from China – responsible for more than half of the world's total metal consumption.
Copper prices, fell 3.40% to $2.74, while zinc prices fell 2.60% to 2,557.50.
Aluminium prices fell 1.23% to 2,062.00, while Nickel Futures fell 1.59%.
Silver futures fell 1.27% to $15.81 a troy ounce, while Platinum futures lost 1.63% to $832.40.
