Gold Refinery gold shavings. Picture: AFP PHOTO/OZAN KOSE
Gold Refinery gold shavings. Picture: AFP PHOTO/OZAN KOSE

Bengaluru — Gold prices inched back towards last week's four-month low on Tuesday as a firmer dollar and ongoing preference for riskier assets took the sheen off the metal traditionally seen as a safe haven.

Spot gold had slipped 0.2% to $1,272.58 per ounce by 11.51am GMT. Prices last week reached their lowest since December 27 at $1,270.63.

US gold futures trimmed 0.3% to $1,274.40 an ounce.

“Growth worries that had weighed on risk sentiment and supported gold have largely faded,” Julius Baer analyst Carsten Menke said, adding that sentiment in financial markets was positive.

“That's why the positioning on gold is also turning towards the negative side and we have not seen any inflows in exchange traded gold products.”

Data from the US Commodity Futures Trading Commission, showed speculators switched to a net short position in Comex gold in the week to April 16.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were at their lowest levels seen since October 26.

Markets are looking to the release of the US GDP data later in the week for indications about the strength of the world's largest economy.

Better-than-expected economic readings from both the US and China lately have assuaged investor concerns of a sharp global economic slowdown, although weak manufacturing surveys from Asia and Europe have kept a lid on sentiment.

Stronger equities this year have also dented gold's appeal, with the metal now more than 5% below its 2019 peak touched in February.

Analysts and traders said gold's break below key support levels last week, including the 100- and 50-day moving averages, signalled further downside for prices.

“Gold looks vulnerable to a further extension lower through$1,270, opening a test toward the 200-day moving average at$1,251,” MKS Pamp Group said in a note.

In other metals, silver fell 0.2% to $14.95 per ounce. Platinum fell 0.9% to $887.35 per ounce having hit a two-week high of $911.75 in the previous session.

Palladium was 0.8% lower at $1,375.34 per ounce, after falling as much as 3.5% in the previous session.