Investing.com – Gold prices pared gains on Tuesday as reports suggesting that North Korea fired a ballistic missile failed to raise safe haven demand.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange fell by $0.04, or 0.03%, to $1294 a troy ounce.
North Korea sparked geopolitical tensions after South Korean news agency Yonhap reported that the Kim Jong-un led nation fired a ballistic missile in the direction of the Sea of Japan.
“North Korea fired an unidentified ballistic missile from South Pyongan Province early Wednesday”, Yonhap reported citing South Korea's Joint Chiefs.
This reported missile launch comes a day after a Japanese diplomat warned that radio signals detected from North Korea indicated another North Korean missile test was close.
“There is a possibility of missiles launches in the next few days,” a Japanese government official said on Monday, according to Japan's Kyodo news agency. The potential of missile launches from the King Jong-un led nation is believed to be part of North Korea’s army’s winter training regime.
Also supporting gold prices were comments from Federal Reserve chair designate Jerome Powell, who testified before Congress on Tuesday.
Powell’s comments did little to change the widely held view that the incoming Fed chair will adopt a similar stance to outgoing Fed Chair Janet Yellen on monetary policy.
Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
In other precious metal trade, silver futures fell 1.18% $16.82 a troy ounce, while platinum futures added 0.01% to $951.05.
Copper traded at $3.10, down 1.95%, while natural gas rose by 3.94% to $3.14.