Gold edges up in thin trade as dollar dips

Gold prices inched up on Wednesday as the dollar dipped, but moved in a range as investors stayed away in a holiday-thinned week, while palladium extended gains after touching a 17-year peak.

Spot gold rose 0.1 per cent to $1,284.10 an ounce as of 0729 GMT, after hitting its highest since December 1 at $1,284.70. US gold futures were also up 0.1 per cent to $1,289.30 an ounce.

“Asian trade was a relatively subdued affair, void of Tuesday's Chinese interest; the metal held a narrow range throughout the session,” MKS PAMP trader Sam Laughlin said.

The dollar eased against a basket of currencies on Wednesday, while commodity-linked currencies such as the Canadian dollar were underpinned by this week's

rally in oil prices. “Technically, the 38.2 per cent of the move down from the 2017 high of $1,357 comes in at $1,282. The 100-day moving average is at $1,286. So, these levels will be watched for further moves,” said Amit Kumar Gupta, portfolio management services head at Adroit Financial Services.

Meanwhile, the United States announced sanctions on two North Korean officials behind their country's ballistic missile programme on Tuesday. Geopolitical risks can boost the demand for safe-haven assets such as gold and the Japanese yen.

“More people are looking at gold as a portfolio rotation ... Both gold and silver are seeing some bids despite a firm currency,” a Singapore-based trader said.

Asian shares rose on Wednesday with oil and copper prices rocketing to multi-year highs in an uplifting sign for global growth and inflation, while major currencies were becalmed in a holiday-shortened week.

Among other precious metals, spot palladium rose over 1 per cent to its highest since February, 2001 at $1,069.50 per ounce. Spot silver rose 0.3 per cent to touch its best since late November at $16.58. Platinum edged up 0.5 per cent to hit a three-week high of $923.90.