New York: Gold traded sideways on Tuesday, as a lack of concrete details about an interim US-China trade deal kept investors from making firm bets, while palladium prices were set to break above the key $2,000 (Dh7,345) per ounce level for the first time.
Palladium was 0.5 per cent higher at $1,987.59 an ounce by 0749 GMT, after hitting an all-time peak of $1,998.43.
Spot gold was little changed at $1,476.43 per ounce, with US gold futures flat at $1,480.80.
“The trade situation is improving ... but the weaker dollar is counter balancing that. So, we’re seeing tight ranges for gold prices with these two factors running in opposite directions,” said Michael McCarthy, chief market strategist at CMC Markets.
The dollar index was little changed after posting losses in the previous two sessions, making gold cheaper for holders of other currencies.
Investors are keen to know more about the preliminary trade deal struck between United States and China last week.
“There is a real risk that when it comes to the actual [deal] document, we could see some market disappointment and that of course would be supportive for gold,” McCarthy added.
The “Phase One” trade deal has been “absolutely completed”, a top White House adviser said on Monday. However, Chinese officials have been more cautious, emphasising that the trade dispute has not been completely settled.
Gold, considered a safe investment in times of political and economic uncertainty, has gained about 15 per cent this year, mainly driven by the 17-month-long tariff war and its impact on the global economy.
Capping bullion’s advance, Asian shares rose to their highest in more than a year on trade deal optimism. Among other precious metals, palladium, used mainly in catalytic converters in vehicles, has gained more than 57 per cent so far this year on a sustained supply crunch.
“Supply concerns have kept the metal buoyant, and underlying demand appears to be in good shape still on pullbacks,” MKS PAMP said in a note.
“We look set for an imminent test above $2,000, but we feel there will be some good supply above there from the spec community,” they added, referring to speculators.