Gold Slips as India-Pakistan Tensions Mount

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Gold Slips as India-Pakistan Tensions Mount – Gold slipped on Wednesday, as fresh hostilities erupted between nuclear-armed neighbors India and Pakistan.

Pakistan said it shot down two Indian fighter jets, a day after Indian warplanes struck inside Pakistan for the first time since a war in 1971, prompting several world powers to urge both sides to show restraint.

“This adds another layer of risks for investors”, said Charles St-Arnaud, a strategist at Lombard Odier, although he noted the market moves remained limited for now.

Comex gold futures were little changed, down $0.75, or around 0.1%, at $1,327.95 a troy ounce by 8:50AM ET (13:50 GMT).

Spot gold was trading at $1,326.22 per ounce, down $2.45, or roughly 0.2%.

Markets were paying attention to a summit between U.S. President Donald Trump and North Korean leader Kim Jong Un, which got under way in the Vietnamese capital of Hanoi.

Investors also looked ahead to a second appearance from Federal Reserve Chairman Jerome Powell, after comments he made Tuesday reinforced views the central bank has shifted to a more “patient” approach to monetary policy.

“We don’t expect Powell’s second round of testimony before the U.S. House Financial Committee to change,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was little changed near its lowest since early February at 95.85.

In other metals trading, silver futures were steady at $15.82 a troy ounce.

Meanwhile, palladium futures dipped 0.5% to $1,512.45 an ounce. The metal had scaled a record high of $1,565.10 in the previous session.

The autocatalyst metal has climbed 23% so far this year on widening supply tightness in the market.

— Reuters contributed to this report