Gold prices continued to slide during Asian trading hours on Tuesday, after plunging to its lowest level in last 5 weeks in the preceding session as bargain hunting was missing in the backdrop of Chinese Lunar Year celebrations while North Korea’s third successful nuclear test also failed to generate any fresh demand for safe haven bids.
At around 7:00 a.m. EST, gold futures for April delivery fell 0.15% to $1646.70 an ounce while spot gold inched up 0.08% to $1648.90 an ounce.
Although markets in Japan and South Korea reopened on Tuesday, markets in mainland China along with Hong Kong, Singapore, and Taiwan were shut as people celebrate weeklong Chinese New-year holidays.
Earlier today North Korea confirmed that it has successfully carried its third nuclear test; however, the news failed to trigger any panic reaction from the neighboring countries like Japan.
“Nobody in Japan is interested in buying or selling based on this news,” said a physical dealer at one of Japan's main bullion houses, while speaking to Thomson Reuters.
Tokyo gold futures edged down 42 yen to trade at 4,988 yen a gram as speculators closed positions in order to book profits after last week’s rally when its benchmark gold contract hit the record high of 5,081 yen a gram. Physical demand was also weak in Asia which was reflected by declining prices. Gold bars remained at a discount of between 75 cents to $1 to spot prices in London, showed a data provided by Thomson Reuters.
Meanwhile bullion investors will keep a close eye on the G7 Summit, scheduled to start later this week. Investors will be hoping to get a clear direction from leaders from the most industrialized nations on how they intend to fix the mechanism for the currency markets, more importantly euro.
Lately, gold prices, in the absence of any bullion friendly news, have tended to follow fluctuations in currency markets.
Silver futures lost 0.23% to $30.84 an ounce.
In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV
) was down 0.33% to $29.90, and the ProShares Ultra Silver (ETF) (NYSE: AGQ
) was down 0.55% to $45.26.