Gold prices were hovering near yesterday’s settlement despite a stronger dollar as investors unwound short positions.
Gold for December delivery on the Comex division of the New York Mercantile Exchange rose 10 cents to $1,118.50 per pounce. Trade has ranged from $1,115.60 to $1,120.40.
“Even the renewed appreciation of the US currency in the later course of [yesterday's] trading put no further pressure worth mentioning on gold, which suggests that sentiment towards gold is improving,” Commerzbank said.
The data bears this out with the net long fund position (NLFP) in gold increased by 2,542 contracts, or nine percent, to 32,442 from 29,900 contracts in the week ending August 11, according to the latest CFTC statistics.
The increase in the net length for the second consecutive week was driven by long accumulation – up 2,986 contracts – that was slightly counterbalanced by a small increase in short positions of 444 contracts. The net length is down about 72 percent in the year-to-date.
“The price rise in the meantime suggests that speculators are covering further short positions,” the bank added.
Turning to currency news, the People’s Bank of China (PBoC0 lowered the reference slightly of the yuan to 6.3966 from 6.3939. The ongoing devaluation to the dollar is leading investors to selloff Chinese positions.
Overnight, the Shanghai Composite Index fell 6.2 percent to 3,748.16.
Meanwhile in data, Chinese new home prices fell by 3.7 percent in July from the previous year. However, the decline didn’t match June’s 4.9 percent dip. New home prices climbed in 31 out of the 70 cities monitored, up from 27 previously.
US housing starts and building permits are scheduled for release later today.
In wider markets, Germany’s DAX and France’s CAC-40 were down 0.4 percent and 0.5 percent respectively, while the euro was 0.2 percent softer at $1.1056 against the dollar.
As for the other precious metals, Comex silver for September delivery was last down 25.3 cents at $15.045 per ounce. Trade has ranged from $15.0 to $15.325.
Platinum for October delivery on the Nymex fell $7.9 at $992.80 per ounce, while the most-actively traded palladium contract was at $602.45 per ounce, down $11.35.
(Editing by Tom Jennemann)
The post Gold unchanged as bearish tone evaporates, dollar rises appeared first on The Bullion Desk.
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