Nov 15 (Reuters) - Gold held steady on Thursday as the
dollar regained momentum after Britain's Brexit agreement was
thrown into turmoil, offsetting limited interest in the metal
from investors seeking cover from the political fallout.
Spot gold was unchanged at $1,211.21 per ounce at
1057 GMT. Prices rose 1 percent in the previous session.
U.S. gold futures were up 0.1 percent at $1,211.60
per ounce.
The dollar index jumped, making bullion less
attractive for holders of other currencies, after Britain's
Brexit deal with the European Union was plunged into chaos.
However, some safe haven demand flowed into gold, a
traditional store of value during times of political and
economic uncertainty, as stock markets declined.
"We have seen some resignations from the British cabinet ...
so that uncertainty is offering some support to gold prices in
the immediate term," ING analyst Warren Patterson said.
"We will find very good support at $1,200 but will struggle
to break up above $1,250 in the near term."
Just over 12 hours after May announced that her team of top
ministers had agreed to the terms of the draft agreement, Brexit
Minister Dominic Raab and Work and Pensions Minister Esther
McVey quit, saying they could not support it.
The dollar has emerged as a dominant safe haven asset this
year, denting appeal for gold, which has fallen 11 percent from
an April peak as investors opted for the greenback instead,
especially as the U.S.- China trade tussle played out against a
backdrop of rising U.S. interest rates.
U.S. consumer prices increased by the most in nine months in
October amid gains in the cost of gasoline and rents, pointing
to steadily rising inflation that will likely keep the Federal
Reserve on track to raise rates again next month.
In the latest developments surrounding the ongoing trade
dispute, U.S. President Donald Trump is expected to meet Chinese
President Xi Jinping on the sidelines of a G20 summit in
Argentina later this month.
"If prices manage to remain above $1,210 there will be space
for further recoveries, while another fall below the
psychological threshold of $1,200 would represent a negative
signal," ActivTrades chief analyst Carlo Alberto De Casa said in
a note.
Also indicative of improved appetite for gold, holdings of
the world's largest gold-backed exchange-traded fund, SPDR Gold
Trust , remained near their highest level in more than two
months, while central banks have also been gradually increasing
their reserves of the metal, analysts said.
Among other precious metals, silver was up 0.1
percent at $14.15 per ounce. The metal fell to its lowest since
Jan. 21, 2016 at $13.85 in the previous session.
Platinum fell 0.6 percent to $829.74 an ounce, while
palladium was 0.5 percent higher at $1,130.30 per ounce.
