Gold clocks up as U.S.-China tensions sour risk appetite

Friday,   29-May-2020   08:58 AM (IST)

Gold prices ticked up on Friday as the Sino-U.S. rift deepened over further moves by Beijing to impose a security law on Hong Kong, lifting the allure of safe havens amid market uncertainties caused by the pandemic. Spot gold was up 0.1% at $1,719.63 per ounce, as of 1249 GMT. U.S. gold futures  rose 0.4% to $1,734.60. Denting sentiment further, China approved a decision to go forward with a national security legislation for Hong Kong, which could erode the city's freedom and jeopardise its role as a financial hub. U.S. President Donald Trump's top economic adviser warned that Hong Kong, which has enjoyed special privileges, may now need to be treated like China when it comes to trade and other financial matters. Trump, who has vowed a tough U.S. response, will hold a news conference on China on Friday. U.S. jobless claims dropped for the eight straight time last week, but remained at high levels implying it could take a while for the economy to recover, data showed. Germany's economy is likely to shrink by 6.6% this year, the Ifo Institute said; while in a Reuters poll the Indian economy was seen rapidly slowing in the March quarter. A Reuters poll also showed that 2020 will be the worst year for many world stock markets in nearly a decade. Asian shares were set to dip in choppy trade. Governments and central banks globally unleashed massive stimulus programs to cushion the pandemic fallout. Palladium was flat at $1,930.67 per ounce, platinum declined 0.9% to $830.81, and silver fell 0.3% to $17.38.