US MIDDAY: gold soars

Gold rose on Monday on geopolitical worries, but was trading in a tight range in the absence of any fresh clues on US monetary policy and as the market looked to economic data later in the week for more direction. Supporting gold was geopolitical tension sparked by US President Donald Trump who on Sunday held out the possibility of using trade as a lever to secure Chinese cooperation against North Korea.
Global equity markets eased on Monday as investors assessed how Trump's protectionist stance on trade will play out during meetings with Chinese President Xi Jinping slated for Thursday and Friday.
Spot gold was 0.3 percent higher at $1,252.66 per ounce by 2:15 pm EDT (1815 GMT), trading in a range between $1,244.05 and $1,253.52. "While the European elections, Brexit negotiations and Trump's foreign policies could reignite safe-haven interest, gold is not without hurdles," Standard Chartered said in a note. "We believe the fragile physical market and Fed rate hikes will create a softer footing for gold prices. We maintain our view that Q2 and Q3-2017 are likely to mark the strongest quarters for gold prices this year."
Gold is often seen as an alternative investment during times of geopolitical and financial uncertainty. Bullion largely shrugged off a firmer dollar, which hit a two-week high against a basket of currencies before easing to trade up 0.2 percent. The dollar was up after US construction spending and manufacturing data on Monday were positive overall, affirming the economy's steady improvement.
"Gold is holding well in spite of being torn between buyers and sellers now as interest rate curve flattening in the US indicates possibly less inflation," said George Gero, managing director at RBC Wealth Management. Spot gold notched a quarterly gain of about 8.4 percent on Friday, marking its best quarter in a year, mostly driven by uncertainties around Trump's policies and elections in Europe. Hedge funds and money managers raised their net long position in COMEX gold for the second straight week in the week to March 28, and boosted it slightly in silver, US Commodity Futures Trading Commission data showed on Friday.
In other precious metals, spot silver edged down 0.3 percent to $18.17 per ounce but held near one-month highs. Platinum rose about 1 percent to $953.65, after recording its best quarter in a year. Palladium was up 0.9 percent at $802.20 an ounce and is up about 17 percent so far this year.