Gold prices moved higher on Thursday, despite the U.S. dollar rising to a one-week high on hawkish Fed minutes.
A sell-off in Asian stock markets amid rising worries about the U.S.-China trade tensions and a slowing Chinese economy and the sharp plunge on Wall Street after Treasury Secretary Steven Mnuchin announced he will not attend an upcoming investment conference in Saudi Arabia, prompted traders to switch their focus to the bullion.
The minutes of the Federal Reserve’s latest policy meeting indicated that the U.S. central bank is staying the course on rate hikes, despite President Donald Trump calling it the “biggest threat” to his presidency.
After seeing some weak spells in recent weeks, the yellow metal is slowly regaining its safe haven status.
Gold futures for December ended up $2.70, or 0.20%, at $1,230.10 an ounce. On Wednesday, gold futures ended down $3.60, or 0.3%, at $1,227.40 an ounce.
Silver futures for December settled at $14.604 an ounce, down $0.059 from previous close.
Copper futures for December ended down $0.0315, at $2.7465 an ounce.
The U.S. Treasury Department has decided not to label China a currency manipulator, but Secretary Steven Mnuchin said that China’s lack of transparency over its currency and recent weakness in the yuan are of “particular concern” for the United States and “pose major challenges to achieving fairer and more balanced trade.
In a move that aims to pressure Beijing, the Trump administration moved to withdraw from an international treaty on postal rates.
Meanwhile, Mnuchin posted in Twitter that he will not be participating in the Future Investment Initiative summit in Saudi Arabia. Mnuchin is among several other top executives and international finance leaders to have dropped out of the conference. His decision comes in the wake of Saudi Arabia continuing to face considerable international pressure over the recent disappearance of journalist Jamal Khashoggi.
On the U.S. economic front, a report from the Labor Department showed a modest decrease in initial jobless claims in the week ended October 13th.
A separate report released by the Federal Reserve Bank of Philadelphia showed manufacturing activity in the Philadelphia area grew at a slightly slower rate in the month of October. The Philly Fed said its diffusion index for current general activity edged down to 22.2 in October from 22.9 in September, although a positive reading still indicates growth in regional manufacturing activity. The index had been expected to drop to 20.0.
Meanwhile, the Conference Board released a report showing its index of leading U.S. economic indicators climbed by 0.5% in September after rising by 0.4% in August.