Gold prices dipped on Thursday as the dollar held its strong gains from the previous session, but simmering tensions over Russia and a potential trade war offered support. Gold posted its biggest one-day percentage fall in nearly nine months on Wednesday after robust US data lifted the dollar, which steadied at those strong levels on Thursday.
Spot gold had slipped 0.2 percent to $1,322.65 per ounce by 1403 GMT, after hitting a low of $1,322.50 earlier in the session, its lowest since March 21. US gold futures for April delivery were down 0.1 percent at $1,323.30 per ounce. Spot gold dropped 1.5 percent on Wednesday, the biggest one-day percentage decline since July 3, 2017. "I don't see gold falling much further from here given the continued geopolitical tensions," said Carsten Fritsch, commodity analyst at Commerzbank in Frankfurt.
"There was an easing of tensions in the Far East regarding North Korea, but there's still tension between the West and Russia... this can boil over again and support gold." North and South Korea will hold their first summit in more than a decade on April 27, South Korean officials said.
Moscow has threatened to retaliate after the United States and other Western countries expelled more than 100 Russian diplomats over the poisoning of Russian former double agent Sergei Skripal and his daughter in England with a military-grade nerve toxin. Concerns about a global trade war have eased but that does not mean it is over, said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
Gold demand was subdued in most of Asia, except in India where discounts narrowed this week on an improvement in demand for weddings and hopes that retail purchases will rise next month on account of a key festival. Gold, often seen as an alternative investment at times of political and financial uncertainty, was on track for a third straight quarter of gains, having risen 1.5 percent so far.
In other precious metals, spot silver dipped 0.1 percent to $16.27 per ounce after falling to $16.20, its lowest in one week. Silver was on track to post a quarterly loss of 4 percent after two quarters of modest gains. Platinum rose 0.2 percent to $933.39 per ounce, recovering after hitting $928.50, the weakest since January 2. The metal was down about 5 percent so far this month, on course to post its worst month since September.
Palladium, up 0.1 percent to $965.50 an ounce, was set to fall over 7 percent this month, the steepest drop since December 2016. For the quarter, the metal is down 9 percent so far, its biggest loss since the quarter ended December 2015.