Off The Wire
PRECIOUS-Gold slips to 1-year low as U.S. dollar firms
* Dollar holds firm after Fed Chairman's testimonies
* Palladium touches near one-year low
* GRAPHIC-2018 asset returns: (Updates prices) By Zandi Shabalala LONDON, July 19 (Reuters) - Gold sank to a one-year low on Thursday as the dollar powered higher after comments from U.S. Federal Reserve chairman Jerome Powell which reaffirmed expectations for more interest rate rises in the world's largest economy. Powell, in a closely watched two-day congressional testimony, said he believed the United States was on course for years more of steady growth, and carefully played down the risks to the U.S. economy of an escalating trade conflict. The Fed raised rates in June and policymakers indicated they expect two more rate increases this year. Powell said nothing in his testimony this week to undermine that, and said the economy was poised for several more years of growth. Gold is highly exposed to interest rates, particularly in the United States, as higher rates lift the opportunity cost of holding non-yielding assets and boost the dollar, in which gold is priced. Spot gold fell 0.7 percent to $1,217.95 per ounce by 1422 GMT, having earlier touched its lowest since July 2017 at $1,211.08. U.S. gold futures for August delivery were 0.9 percent lower at $1,216.56 an ounce. "It's a tough environment for gold," said ETF Securities associate director Anneka Gupta, adding that growth in the U.S economy and stronger corporate earnings undermined the metal.
"Gold is not being used as a safe haven right now despite the ongoing trade war, and the stronger dollar is dominating the story amidst the rate-rising environment." Gold is generally regarded as a safe and stable store of value during times of global uncertainty.
The dollar rose to a one-year high against a basket of six major currencies , supported by bullish comments from Powell, which affirmed expectations for more interest rate increases this year. "Gold should find first support at yesterday's low of $1,221, with the psychological $1,200 level to follow. Resistance (is) at $1,229, with this week's high of $1,245 above that," MKS PAMP Group said in a note. U.S. President Donald Trump said on Wednesday the United States may hammer out a trade deal with Mexico, and then do a separate one with Canada later, sowing fresh doubts about the future of the North American Free Trade Agreement (NAFTA). Among other precious metals, silver was down 1.6 percent at $15.27 an ounce, its lowest since last July. Platinum was 2.2 percent lower at $795 an ounce, its lowest since 2008. Palladium fell 1.6 percent to $893 per ounce, having slipped to its lowest since August 2017 at $888.65. (Reporting by Zandi Shabalala in London and Karen Rodrigues in Bengaluru; Editing by Elaine Hardcastle, Jan Harvey and Kirsten Donovan)firstname.lastname@example.org))