Investing.com – Gold prices traded a touch higher on Monday shrugging off the return of demand for riskier assets as the prospect of a U.S.-China trade war eased.
Gold futures for June delivery on the Comex division of the New York Mercantile Exchange rose by $3.90, or 0.30%, to $1,340.00 a troy ounce.
U.S. officials downplayed the prospect of a trade war with China, appearing somewhat optimistic that the current trade dispute between the world’s largest two economies would be resolved through negotiations and not result in a trade war.
“I don’t know whether we’re going to have tariffs or not,” said White House economic adviser Larry Kudlow on Monday. “We may. On the other hand we may be able to settle this with negotiations.”
Easing trade-war fears, reduced demand for safe-haven gold but that was partly offset by a rise in geopolitical tensions. U.S. President Donald Trump vowed to make a decision on how to proceed in Syria within the coming days amid an alleged chemical-weapons attack in Syria.
The positive start to the week for the precious metal comes despite a report showing traders cut their bullish bets on gold last week for the first time in three weeks.
Dollar weakness, following a sharp rise in the Canadian dollar on signs of North American Free Trade Agreement (NAFTA) negotiation progress, also lent support to gold prices.
Dollar-denominated assets such as gold are sensitive to moves in the dollar – A fall in the dollar makes gold cheaper for holders of foreign currency, raising demand for the precious metal.
CFTC COT data showed money managers reduced their net long positions in gold futures to 166,000 lots from 203,400 lots for the week ended April 6.
In other precious metal trade, silver futures rose 1.00% to $16.53 a troy ounce, while platinum futures rose 2.20% to $937.70 an ounce.
Copper gained 0.80% to $3.083.