Gold dropped more than 1 percent on Thursday, retreating after an early rise as the US dollar strengthened when President Donald Trump talked up a stronger greenback. The dollar reversed earlier losses and US stocks relinquished gains after Trump told CNBC in an interview in Davos, Switzerland that he wants to see a strong dollar.
That sent gold tumbling to a session low of $1342.70 per ounce. A day earlier, the dollar fell and gold rose after US Treasury Secretary Steven Mnuchin said he welcomed a weaker currency. "The second Trump's comments came out, we saw weakness in the euro and strength in the dollar that bled over into other markets," said Phillip Streible, senior commodities strategist at RJO Futures in Chicago.
"Gold started to sell off and silver followed. Once that occurred, it seems like people long on this rally that had built up a lot of positions at these higher levels were nervous that they'd give up their gains that they've seen over the last few weeks." Spot gold was down 0.8 percent at $1,347.39 by 4:21 p.m. EST (2121 GMT). Its session high of $1,366.07 was the highest since Aug. 3, 2016. On Wednesday it jumped 1.3 percent in the biggest daily gain since August.
Earlier, US gold futures for February had settled up $6.60, or 0.5 percent, at $1,362.90 per ounce. In other precious metals, silver dropped 1.5 percent at $17.30 an ounce after touching $17.70, its highest since Sept. 15. Platinum was down 0.2 percent at $1,010.50 an ounce after hitting its highest since February 2017 at $1,027.60. Palladium fell by 1.5 percent at $1,094.35 an ounce.
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