Gold Drifts Weaker In Asia, Shrugs Off North Korea Missile Test

London (May 29)  Gold fell slightly in Asia on Monday, shrugging off the latest missile test by North Korea and drifting in trade with China, the U.S. and The U.K. markets shut for holidays.

Gold futures for June delivery on the Comex division of the New York Mercantile Exchange eased 0.13% to $1,266.42 a troy ounce.

Last week, gold rose to a nearly one-month high Friday, shrugging off a rise in the dollar to a four-day high, following an upward revision to U.S. economic growth and expectations the Federal Reserve would hike its benchmark rate in June.

The U.S. economy grew faster than initially reported during the first three months of 2017, easing concerns about a potential slowdown in the U.S. economy.

Gross domestic product grew at an annualized rate of 1.2% in the first three months of 2017, according to the Bureau of Economic Analysis, well above the previous reading of 0.7%, which was the slowest period of economic growth since 2014.

The dollar leaped to a four-day high, and pressured commodity prices across the board, as expectations for a June rate hike rose to its highest level this week.

According to investing.com's Fed rate monitor tool, more than 80% of traders expect the Federal Reserve to hike its benchmark rate in June, compared to below 70% of traders in the previous week.

Gold is sensitive to moves higher in both U.S. rates and the dollar - a stronger dollar makes gold more expensive for holders of foreign currency while a rise in U.S. rates, lift the opportunity cost of holding non-yielding assets such as bullion.

Source: SeekingAlpha