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Gold inches lower as Trump's remarks boost trade talk hopes

Gold prices edged lower on Friday as U.S. President Donald Trump’s remarks on progress in Sino-U.S. trade talks lifted risk appetite, while palladium was set to end a three-day winning streak after touching a record high in the previous session.

Spot gold was down 0.2% at $1,491.12 per ounce, as of 0105 GMT. U.S. gold futures dipped 0.2 % to $1,498.50.

Spot Palladium shed 0.1% to $1,698.06 per ounce, after hitting an all-time peak of $1,704.59 on Thursday.

Top U.S. and Chinese negotiators wrapped up a first day of trade talks in more than two months on Thursday as business groups expressed optimism the two sides might be able to ease a 15-month trade war and delay a U.S. tariff hike scheduled for next week.

U.S. President Donald Trump said trade talks between U.S. and Chinese officials on Thursday went very well and the two sides had a very, very good negotiation.

Negotiators could agree to low-level “early harvest” agreements on issues such as currencies and copyright protections, despite increased irritants between the world’s two largest economies, a U.S. Chamber of Commerce official briefed by both sides said.

Shares in Asia and U.S. stock futures rose on Friday, with MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.4%.

A 15-month trade war between the two countries has fanned financial market fears of a recession.

On the data-front, U.S. consumer prices were unchanged in September and underlying inflation retreated, supporting expectations the Federal Reserve will cut interest rates in October for the third time this year amid risks to the economy from trade tensions.

The U.S. economy will likely skirt a serious downturn despite current risks from trade and a slowing global economy, Cleveland Fed President Loretta Mester said.

Irish Prime Minister Leo Varadkar said on Thursday a Brexit deal could be clinched by the end of October to allow the United Kingdom to leave the European Union in an orderly fashion, after what he called a very positive meeting with Boris Johnson.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.22 percent to 921.71 tonnes on Thursday from 923.76 tonnes on Wednesday.

HSBC Bank said it forecasts end of year gold prices for 2019 and 2020 at $1,555 per ounce and $1,605 per ounce respectively.

Courtesy - Reuters



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