Gold prices turned weak on Tuesday as the dollar advanced and equities rebounded amid renewed risk appetite after trade worries eased a bit following the U.S. government easing some restrictions on Chinese telecom giant Huawei Technologies Co.
Lingering uncertainty about Brexit, tensions in the Middle East and a downward revision in global growth forecast by The Organization for Economic Co-operation and Development limited gold's losses.
The dollar gained in strength against most major currencies. The dollar index, which advanced to 98.13, was seen trading at 98.03, up 0.1%, an hour after noon.
Gold futures for June ended down $4.10, or 0.3%, at $1,273.20 an ounce, the lowest settlement in nearly three weeks.
On Monday, gold futures for June ended up $1.60, or about 1%, at $1,277.30 an ounce, after suffering a loss of 0.8% a session earlier.
Silver futures for July ended down $0.035, at $14.410 an ounce, while Copper futures for July settled at $2.7150 per pound, down $0.0110 from previous close.
Stocks rose thanks to a positive reaction by traders to news that the U.S. Commerce Department has temporarily eased trade restrictions on Chinese tech giant Huawei and issued a temporary license authorizing specific, limited engagement in transactions involving the export, re-export, and transfer of items to Huawei for 90 days.
In economic news, existing home sales in the U.S. unexpectedly showed a modest decrease in the month of April, according to a report released by the National Association of Realtors on Tuesday.
NAR said existing home sales dipped by 0.4% to an annual rate of 5.19 million in April after plunging by 4.9% to a rate of 5.21 million in March. Economists had expected existing home sales to jump by 2.7% to a rate of 5.35 million.
In its latest Economic Outlook, published Tuesday, OECD lowered global growth forecast, citing vulnerabilities stem from trade tensions, high policy uncertainty, risks in financial markets and a slowdown in China.
The biggest threat is the escalation of trade-restrictive measures, OECD Secretary-General Angel Gurr?a said.
The agency forecast 3.2% growth for 2019 versus 3.3% estimated in March. The global growth outlook for 2020 was retained at 3.4%.
The OECD forecast the U.S. economic growth at 2.8% in 2019, and 2.3% in 2020. In March, the OECD had forecast 2.6% growth for this year and 2.2% in 2020.
Growth in the euro area is seen at 1.2% this year and 1.4% next year. Both figures were revised up by 0.2 percentage points.
The agency said the sharper slowdown than already seen in China would pose important risks to both global growth and trade prospects.
Markets now look ahead to the minutes of the Federal Reserve's latest monetary policy meeting. The minutes, to be released on Wednesday, is expected to provide clues about the central bank's likely stance on interest rates for the rest of the year.