Gold prices ease as stronger dollar outweigh lingering economic concerns
Gold prices declined as a stronger dollar offset lingering economic concerns from the coronavirus crisis, while markets await the European Central Bank meeting outcome for further cues on the monetary policy outlook.
Spot gold was trading 0.3 percent lower at $1,926.67 per ounce by 0707 GMT, having hit a low of $1906.62 on Tuesday, its lowest since August 12. U.S. gold futures fell 0.5 percent to $1,934.00.
The dollar index rallied to a 4-week peak against its rivals amid renewed Brexit concerns and bets that policy signals from the European Central Bank on Thursday could weigh on euro.
Sterling slumped to an over 1-month low amid growing fears that Britain is preparing to undercut its Brexit divorce treaty. The European Union has warned there will be no trade deal if Britain tries to override parts of the Withdrawal Agreement it signed in January.
Euro consolidated near a 3-week low recorded earlier in the session as investors cautiously awaited the European Central Bank policy meeting for hint of concern at the currency's rise or that low inflation will require ultra-easy policy for a very low time.
Asian shares declined as risk sentiment weakened after a major drugmaker delayed testing of a coronavirus vaccine. AstraZeneca Plc paused a late-stage trial of one of the leading COVID-19 vaccine candidates due to an unexplained illness in a study participant.
Coronavirus cases rose in India, Great Britain, Spain and several parts of the United Stated, threatening hopes for a global economic recovery.
China’s factory gate prices declined at their slowest annual pace in five months in August, suggesting industries continued their recovery from the coronavirus-induced slump.
The greenback against a basket of currencies traded up at 93.53, having touched a high of 93.58 earlier, its highest since August 12. The U.S. Treasury yields eased, with the benchmark 10-year note yield trading at 0.665 percent.