Investing.com – Gold prices continued to oscillate around the $1,300 level as surging U.S. bond yields limited gains from a plunge in the dollar.
Gold futures for June delivery on the Comex division of the New York Mercantile Exchange rose by $2.30 or 0.18%, to $1,301.30 a troy ounce.
Gold prices traded in a narrow range on Wednesday as signs the Italian crisis was abating reduced safe-haven demand, triggering risk-on sentiment, offsetting support from a plunge in the U.S. dollar index.
Safe-haven demand eased as hopes emerged for the formation of an elected coalition government in Italy after Italy’s designate Prime Minister Carlo Cottarelli was reportedly mulling “new possibilities” to form a government.
"During his [Cottarelli] work as premier designate for the formation of a new government, new possibilities emerged for the creation of a political government," sources told Italian news agency ANSA.
Souring U.S.-China relations, however, added some support for safe-haven gold after China said it was ready for any trade war. This comes after the United States said Tuesday it would move ahead with its plan to impose $50 billion worth of tariffs on Chinese goods next month.
Gold prices were also held back by a surge in the U.S. 10-year treasury yields, a day after suffering its largest one day drop in nearly two years.
Gold is sensitive to moves higher in U.S. rates, which lift the opportunity cost of holding gold as it pays no interest.
In other precious metal trade, silver futures rose 1.02% to $46.54 a troy ounce, while platinum futures rose 0.35% to $909.30 an ounce.
Copper rose 0.15% to $3.07.