Investing.com - Gold futures pared gains to trade little changed on Tuesday, as renewed concerns over the euro zone’s debt crisis pushed the U.S. dollar higher, reducing the appeal of the precious metal.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,642.95 a troy ounce during U.S. morning trade, adding 0.05%.
It earlier rose by as much as 1.05% to trade at USD1,655.55 a troy ounce, the highest since April 3.
Gold futures were likely to find support at USD1,613.55 a troy ounce, the low from April 4 and resistance at USD1,685.25, the high from April 2.
Gold pared gains as the dollar index recovered from early losses and entered positive territory amid caution about the euro zone.
The euro came under pressure as concerns over high Spanish borrowing costs intensified as the as the yield on 10-year government bonds ticked up to 5.93%, the highest since December, amid fears that the country will be the next in the euro zone to require a bailout.
The increase came in spite of reassurances form Spanish Prime Minister Mariano Rajoy earlier that the country will cut its budget deficit to 3% of gross domestic product in 2013.
The news prompted investors to shun riskier assets, such as stocks and industrial commodities, and flock to the relative safety of the U.S. dollar.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.18% to trade at 80.11.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Gold prices were higher during the Asian trading session as prices drew support from expectations of increased demand in top consumer India after gold jewelers in the country ended a three-week strike over the weekend.
The strike came to an end after India’s Finance Minister Pranab Mukherjee pledged to reconsider newly imposed taxes on the precious metal.
The 21-day work stoppage crippled the nation’s gold market after the country announced a 4% import duty hike on gold and a 0.3% excise tax on most gold jewelry.
Prices were expected to receive a boost in the near-term as one of the nation’s largest Hindu gold-buying festivals of Akshaya Tritiya begins on April 24.
In addition, the wedding season has already started in some parts of India. Gold is an integral part of most Indian weddings.
Gold's downward spiral in recent weeks was exacerbated by the absence of the world's largest consumer of the metal. India's gold imports for March are expected to total between 15 to 20 metric tons, down from 50 to 60 tons in the same month last year.
Imports are expected to rebound, with figures for April and May expected to total around 100 metric tons, Prithviraj Kothari, president of the Bombay Bullion Association, said Monday.
Elsewhere on the Comex, silver for May delivery fell 0.75% to trade at USD31.28 a troy ounce, while copper for May delivery tumbled 1.15% to trade at USD3.678 a pound.
Copper prices came under pressure amid indications Chinese demand for the industrial metal was slipping. China's imports of copper fell 4.6% to 462,182 metric tons in March from 484,569 metric tons the previous month.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,642.95 a troy ounce during U.S. morning trade, adding 0.05%.
It earlier rose by as much as 1.05% to trade at USD1,655.55 a troy ounce, the highest since April 3.
Gold futures were likely to find support at USD1,613.55 a troy ounce, the low from April 4 and resistance at USD1,685.25, the high from April 2.
Gold pared gains as the dollar index recovered from early losses and entered positive territory amid caution about the euro zone.
The euro came under pressure as concerns over high Spanish borrowing costs intensified as the as the yield on 10-year government bonds ticked up to 5.93%, the highest since December, amid fears that the country will be the next in the euro zone to require a bailout.
The increase came in spite of reassurances form Spanish Prime Minister Mariano Rajoy earlier that the country will cut its budget deficit to 3% of gross domestic product in 2013.
The news prompted investors to shun riskier assets, such as stocks and industrial commodities, and flock to the relative safety of the U.S. dollar.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.18% to trade at 80.11.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Gold prices were higher during the Asian trading session as prices drew support from expectations of increased demand in top consumer India after gold jewelers in the country ended a three-week strike over the weekend.
The strike came to an end after India’s Finance Minister Pranab Mukherjee pledged to reconsider newly imposed taxes on the precious metal.
The 21-day work stoppage crippled the nation’s gold market after the country announced a 4% import duty hike on gold and a 0.3% excise tax on most gold jewelry.
Prices were expected to receive a boost in the near-term as one of the nation’s largest Hindu gold-buying festivals of Akshaya Tritiya begins on April 24.
In addition, the wedding season has already started in some parts of India. Gold is an integral part of most Indian weddings.
Gold's downward spiral in recent weeks was exacerbated by the absence of the world's largest consumer of the metal. India's gold imports for March are expected to total between 15 to 20 metric tons, down from 50 to 60 tons in the same month last year.
Imports are expected to rebound, with figures for April and May expected to total around 100 metric tons, Prithviraj Kothari, president of the Bombay Bullion Association, said Monday.
Elsewhere on the Comex, silver for May delivery fell 0.75% to trade at USD31.28 a troy ounce, while copper for May delivery tumbled 1.15% to trade at USD3.678 a pound.
Copper prices came under pressure amid indications Chinese demand for the industrial metal was slipping. China's imports of copper fell 4.6% to 462,182 metric tons in March from 484,569 metric tons the previous month.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.