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Gold prices fell on Monday after the dollar rose on demand for a safe haven sparked by protests in several Chinese cities over the strict restrictions to combat the Coronavirus.
The spot gold price fell 0.4 percent to $1,748.84 an ounce at 0555 GMT. US gold futures fell 0.3 percent to $1,749.60.
The dollar index rose 0.4 percent, making bullion priced in the greenback more expensive for holders of other currencies.
“Gold prices are closely tracking the movements of the US dollar and it seems that the increasing uncertainty due to the growing unrest in China has supported the dollar this morning,” said Yip Rong, market analyst at IG.
Clashes took place between hundreds of demonstrators and police in Shanghai on Sunday evening after the outbreak of protests against the strict restrictions imposed by China to combat the Coronavirus for the third day, and the protests spread to several cities in the wake of a fire that resulted in deaths in the far west of the country.
At the same time, on Monday, China recorded the fifth consecutive record number of daily infections with the Coronavirus.
Yip said people may turn to lower-risk assets given the Covid situation in China, but the dollar’s gains are currently overshadowing gold’s safe-haven status.
As for other precious metals, silver fell 2.2 percent to $21.12 an ounce, platinum fell 0.5 percent to $975.88, and palladium fell 0.2 percent to $1848.38.
