April 5, 2018 / 4:17 AM / 19 days ago

PRECIOUS-Gold slips as fears ease over U.S.-China trade conflict

    * U.S. says willing to negotiate with China amid trade tensions
    * Asian shares bounce from two-month lows
    * China markets closed on Thursday, Friday for public holiday

 (Adds analyst comments, updates prices)
    By Swati Verma
    April 5 (Reuters) - Gold prices fell on Thursday, pulling back from one-week
highs reached the session before, as risk appetite recovered after the United
States expressed willingness to resolve an escalating trade fight with China.
    Spot gold        dipped 0.6 percent to $1,324.96 per ounce by 0701 GMT,
after touching a one-week high of $1,348.06 on Wednesday.
    U.S. gold futures         fell 0.9 percent to $1,328.50 an ounce.
    "Gold ... gave up its gains after (U.S. President Donald Trump's economic
adviser) Larry Kudlow calmed fears that the trade rhetoric will escalate," said
Jordan Eliseo, chief economist at gold trader ABC Bullion.
    The United States voiced willingness on Wednesday to discuss with China
after Beijing retaliated against proposed U.S. tariffs on $50 billion in Chinese
goods by targeting key American imports.             
    As investors pulled out of gold, the dollar gained and Asian equities
rebounded from two-month lows.                    
    Gold's drop shows traders were "liquidating profits and opportunists taking
advantage of the market on a short-term basis," said Joshua Rotbart, managing
partner of J. Rotbart & Co in Hong Kong.
    However, the threat to a global economic recovery from the U.S.-China
tariffs war, rising stock market volatility and growing inflation expectations
could push gold prices higher, RBC Capital Markets said in a note.
    Gold is often used as a store of value during times of financial or
political uncertainty.
    Holdings of SPDR Gold Trust      , the world's largest gold-backed
exchange-traded fund, were largely steady at 852.03 tonnes on Wednesday compared
with 852.31 tonnes on Tuesday.          
    Markets in mainland China, the world's largest gold consumer, are closed for
the Tomb Sweeping Day holiday on Thursday and Friday.             
    Meanwhile, spot silver        inched down 0.2 percent to $16.24 per ounce.
    Platinum        was off 0.5 percent at $907.20 an ounce, after earlier
hitting $901.50, its lowest since December.
    Palladium        was steady at $924.55 an ounce after touching $913 on
Wednesday, its weakest since early October.

 (Reporting by Swati Verma in Bengaluru
Editing by Manolo Serapio Jr. and Biju Dwarakanath)
  
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