Wednesday, 28 June 2017

Gold firm as U.S. Healthcare vote delay Weighs on stocks, Dollar

Gold prices firmed on Wednesday as the dollar struggled and shares weakened after a vote on U.S. healthcare reforms was postponed and European Central Bank President Mario Draghi hinted the ECB could trim its stimulus this year.

Asian shares slumped on Wednesday after Wall Street was knocked hard as U.S. Senate Republican leaders delayed a vote on a healthcare overhaul on Tuesday until next month, adding to investor worries about President Donald Trump's ability to deliver on his promises of tax reform and deregulation.

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The dollar index, which weighs the greenback against a basket of six currencies, slipped to 96.322 on Wednesday, its lowest since November.

Spot gold rose 0.4 percent to $1,251.91 per ounce by 0408 GMT.

U.S. gold futures for August delivery was up 0.5 percent to $1,252.50 per ounce.

"Gold prices recovered from most of the sudden plunge in prices earlier this week, with huge volumes being bought on the open in Europe," ANZ said in a note.

"These gyrations point to erroneous trades, with little macro-events inducing such volatility. In the end, gold is back where it all started at around $1,250/oz," it added.

The precious metal slid 1 percent on Monday as a large sell order hit sentiment, though losses were limited by political uncertainty around the world.

"The dollar and the equities are on the back foot at the moment, providing a little support to gold," a Sydney-based trader said.

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