Investing.com - Gold prices fell on Thursday, pulling away from the two-month highs hit in the previous session as the stronger dollar weighed and fears over escalating tensions in Syria cooled, but remained on investors’ minds.
Gold futures for June delivery on the Comex division of the New York Mercantile Exchange were down $9.5 or 0.68% to $1,350.50 a troy ounce by 05:28 AM ET (09:28 AM GMT).
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.28% to 89.47. A stronger dollar makes the dollar-denominated metal more expensive for holders of other currencies.
Prices of the precious metal hit a two month high of $1,369.10 on Wednesday, propelled higher by geopolitical tensions.
After a Russian diplomat said his country’s forces would shoot down U.S. missiles launched at Syria, U.S. President Donald Trump warned Russia to "get ready” for imminent military action in response to an alleged chemical attack over the weekend.
Investors seek out gold as a store of value during times of market turmoil and political tensions.
Rising geopolitical tensions pulled focus away from fears over a U.S.-China trade war, which had gripped global financial markets in recent weeks.
The dollar found support after Wednesday’s minutes of the Federal Reserve’s March meeting showed that officials believe that the economy will continue to firm and that inflation will rise towards their 2% target in the coming months.
Some investors believed the minutes bolstered the case for a faster pace of monetary tightening by the Fed, a potentially bearish development for gold, which struggles to compete with yield-bearing assets when rates rise.
In other precious metal trade, silver futures fell 1.09% to $16.585 a troy ounce, while platinum futures shed 0.32% to trade at $931.30.
Among base metals, copper futures were down 2.05% to $3.054 a pound.