US MIDDAY: gold falls

Gold prices slipped on Wednesday as US threat of tariffs on an additional $200 billion of Chinese goods pushed safe-haven flows to the US dollar and dashed hopes that Washington would eventually step back from the escalating row. US President Donald Trump detailed overnight a list of Chinese products that could face 10 percent tariffs. The clock now starts ticking on a two-month period of public comment before the levies are imposed.
"Gold is feeling the pressure from commodities across the board and the firmer dollar," said David Meger, director of metals trading at High Ridge Futures in Chicago."
Spot gold gained 0.9 percent at $1,243.57 per ounce by 1:34 p.m. EDT (1734 GMT), earlier sinking to an eight-day low of $1,242.55.
US gold futures for August delivery settled down $11, or 0.9 percent, at $1,244.40 per ounce. "Gold options keep getting higher and higher, which means people are positioned for prices to rise. It tells us there is overhanging positive sentiment to gold but right now the money is sitting on the sidelines," ING analyst Oliver Nugent said.
The news of more possible US tariffs on China is the latest in a tit-for-tat spat between the world's two largest economies.
Spot gold may break support at $1,247 per ounce and fall more towards the next support at $1,237 as it has completed a bounce from the July 3 low of $1,237.32, Reuters technicals analyst Wang Tao said.
"When trade-war risk escalates, investors run for cover ... I always have gold as a hedge but it's been more challenging to have this view when the US dollar is attracting haven flows," said Stephen Innes, APAC trading head at OANDA.
Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Shares, fell 0.22 percent to 799.02 tonnes on Tuesday.
In wider markets, global stock markets fell while metals slumped to their lowest in a year on fears of a trade war. Falling equities, seen as risky assets, usually help gold, a traditional safe haven.
Silver shed 1.4 percent at $15.82 an ounce, while platinum dropped 1.4 percent at $830.60. Earlier in the session, both metals fell to their lowest since July 3.Palladium lost 0.2 percent at $939.50 per ounce, after falling to a two-week low at $931.40.