Spot gold dipped on Thursday as the US dollar pared losses on safe-haven buying from investors fearing a trade war between the United States and China, but gold futures rose, with one trader citing arbitrage trades. US President Donald Trump initiated trade action against China, saying the US deficit with Beijing was "out of control" at about $504 billion and there was a huge "intellectual property theft situation."
Spot gold dipped 0.3 percent at $1,328.21 per ounce by 2:28 p.m. EDT (1828 GMT). US gold futures for April delivery settled up $5.90, or 0.5 percent, at $1,327.40 per ounce. One trader said investors were rolling from the expiring contract of April into the new front month, which is June.
"When you get close to a roll, you can see some dislocation. There are some arbitrage players who try to profit from that," said Michael Matousek, head trader at US Global Investors. "It gets down to the liquidity sometimes. If you wait too late to roll, you're kind of doing yourself an injustice." Meanwhile, spot silver dropped 0.7 percent at $16.41 per ounce, while platinum fell 0.5 percent at $949.40, earlier seeing a 1-week high of $963.60. Palladium fell 0.8 percent at $982.45 per ounce, earlier hitting a 1-1/2-week low at $967.
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