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PRECIOUS-Gold prices gain as U.S.-China trade war takes toll
Published at 27/05/2019 at 02:59

May 27 (Reuters) - Gold prices rose on Monday amid concerns the Sino-U.S. trade war had started to take its toll on the U.S. economy, weakening the dollar and raising hopes of a U.S. Federal Reserve interest rate cut.

FUNDAMENTALS

* Spot gold had edged uo 0.2% to $1,286.89 per ounce as of 0129 GMT.

* U.S. gold futures also gained 0.2%, to $1,285.50 an ounce.

* The U.S. dollar was little changed against a basket of six major currencies, having fallen off a two-year peak in the previous session after orders for U.S.-made capital goods fell, further indicating that manufacturing and the broader economy are slowing, due in part to the U.S.-China trade dispute.

* China on Friday denounced U.S. Secretary of State Mike Pompeo for fabricating rumours after he said the chief executive of China's Huawei Technologies Co Ltd was lying about his company's ties to the Beijing government.

* Escalating trade tensions and weak data have fuelled expectations of a rate cut from the U.S. Federal Reserve.

* Over the weekend, Trump repeated a complaint that the Federal Reserve's policies had kept U.S. economic growth from reaching its full potential.

* Asia stocks edged up early on Monday, while the euro barely budged in early Monday trade after pro-European Union parties held on to two-thirds of seats in the EU parliament elections, limiting gains in nationalist opponents.

* Parties committed to strengthening the European Union held on to two-thirds of seats in the EU parliament, official projections from the bloc's elections showed on Sunday, though far-right and nationalist opponents saw strong gains.

* Hedge funds and money managers sharply reduced their net long positions in COMEX gold in the week to May 21, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

* Gold prices in India flipped into premiums last week on firmer demand in the domestic market, while buyers in top consumer China took advantage of weaker bullion prices and stepped up purchases.

* Gold exports from Mali increased by 15.4% to 61.63 tonnes in 2018, up from 53.4 tonnes in 2017, the West African nation said on Friday, mostly owing to stronger industrial production.

(Reporting by Arijit Bose in Bengaluru; Editing by Joseph Radford)

((Arijit.Bose@thomsonreuters.com; Within U.S. +1 651 848 5832, Outside U.S. +91 8067495254; Reuters Messaging: Arijit.Bose.thomsonreuters.com@reuters.net))