Gold holds steady on weaker dollar, U.S.-Iran tensions

Reuters
FILE PHOTO: Gold bars at the Austrian Gold and Silver Separating Plant 'Oegussa' in Vienna, Austria, March 18, 2016. REUTERS/Leonhard Foeger/File Photo

By Brijesh Patel

(Reuters) - Gold steadied on Monday, holding above a near four-month low touched the previous session on support from a weaker dollar and expectations the United States would further restrict Iranian oil exports.

Spot gold was little changed at $1,275.26 per ounce as of 10:28 a.m. EDT (1428 GMT). On Thursday, it touched $1,270.63, its lowest since Dec. 27. The market was closed on Friday.

U.S. gold futures for June delivery rose 0.1 percent to $1,277.20 an ounce.

"They (U.S.) have taken an aggressive move by not extending the waivers. There are some geo-political risks and a bit of safe-haven demand" for gold, said Bob Haberkorn, senior market strategist at RJO Futures.

He said a weaker dollar and lower equities were also supporting bullion.

Oil topped $74 a barrel on Monday, the highest since November, as the United States was set to announce a further clampdown on Iranian oil exports.

Wall Street equities were trading lower, weighed down by technology shares, which helped bullion accumulate safe-heaven bids.

"There is some risk aversion in the marketplace to start the trading week, as the U.S. is ratcheting up its economic sanctions on Iran," said Jim Wyckoff, senior analyst with Kitco Metals in a note.

The dollar was down 0.2 percent, making bullion cheaper for investors holding other currencies.

On the technical front, gold's break below key support levels, including the 100- and 50-day moving averages last week, signalled a further downside to prices, analysts and traders said.

"Technically, the gold bears have the overall near-term technical advantage," Wyckoff said.

Meanwhile, speculators switched to a net short position in COMEX gold in the week to April 16, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, dropped to 751.68 tonnes on Thursday, the lowest levels seen since Oct. 26.

Among other metals, silver rose 0.6 percent to $15.01 per ounce.

Platinum fell 0.1 percent, to $899.81 per ounce and Palladium was down 0.7 percent to $1,412.61, having earlier climbed to its highest in more than two weeks at $1,429.91 an ounce.

(Reporting by Brijesh Patel in Bengaluru; Editing by David Gregorio)