Yellow Metal, Gold, on Monday,September 11, pulled back, taking a hit as investor interest in assets, such as stocks, that are perceived as riskier, found buying interest on fading worries surrounding North Korea and Hurricane Irma.
Gold for December delivery GCZ7, -1.44% fell $15.50, or 1.2%, to settle at $1,335.70 an ounce, the lowest since Sept. 1, according to FactSet. The SPDR Gold Shares ETF GLD, -1.39% was down 1.2%.
Gold settled at $1,351.20 an ounce on Friday, the highest since Sept. 6, 2016 for a most-active contract, according to FactSet. The metal gained 1.6% last week, chiefly driven by concerns that North Korea was preparing to conduct another missile test over the weekend to mark the country’s Foundation Day. The weekend passed without a test.
Investors had also been worried about economic and safety risks in the run-up to Hurricane Irma, which made landfall in Florida over the weekend. The hurricane has been downgraded to a tropical storm.
The weaker-than-expected storm and ebbing worries over North Korea helped boost global equities, with U.S. stocks trading broadly higher Monday. The ICE U.S. Dollar Index DXY, +0.50% rose 0.6%, with the greenback notably stronger against the Japanese yen USDJPY, +0.00% which along with gold, is another haven asset.
Weakness in the greenback often lifts dollar-denominated gold prices, while the reverse can also be true.
“Market players who were bracing for North Korea to conduct another missile launch over the weekend to mark their foundation day, were relieved when Pyongyang decided to host a celebration instead,” said Lukman Otunuga, research analyst at FXTM. “This reprieve has rekindled appetite for riskier assets, and supported the greenback, while punishing safe havens such as gold.”
Still, the war of words continued from North Korea, with the U.N. Security Council expected to vote on Monday over a U.S. drafted resolution to impose tougher sanctions on North Korea.
“In case the U.S. eventually does rig up the illegal and unlawful ‘resolution’ on harsher sanctions, the DPRK shall make absolutely sure that the U.S. pays due price,” North Korea’s foreign ministry said in a statement via the official KCNA news agency on Monday, according to AFP.
Among other metals, December silver SIZ7, -1.48% fell 22.1 cents, or 1.2%, to $17.902 an ounce, while the iShares Silver Trust ETF edged down by 1.1%.
December copper HGZ7, +1.00% rose 2.5 cents, or 0.8%, to $3.066 a pound after settling down 2.5% last week.
Copper had been trading at a three-year high at one point last week. October platinum PLV7, -1.85% shed $13.50, or 1.3%, to $998.80.50 an ounce, settling under $1,000 for the first time this month. December palladium PAZ7, -0.13% added 40 cents to $931.65 an ounce, MarketWatch reports.
