Gold steadies as Trump speech stokes fears of govt shutdown

BENGALURU, Feb 06 (Reuters): Gold prices held steady on Wednesday after US President Donald Trump, in his State of the Union speech, vowed to build a border wall, but gave little clarity over developments in the ongoing trade discussions with China.

Spot gold was steady at $1,314 per ounce at 0431 GMT.

US gold futures were also steady at $1,318 an ounce.

Trump spoke in the chamber of the House of Representatives facing political discord over his demands that Democrats end their opposition to funding for a border wall he says is needed to stem illegal immigration and smuggled drugs.

"There is a likely risk of another government shutdown with President Trump still sticking to the rhetoric of erecting a border wall," said Hitesh Jain, vice president, Yes Securities, adding that a firmer dollar was capping gold's gains.

"Market participants remain cognizant of the fact that global macro numbers are slowing. Gold as an investment avenue remains very much in the reckoning."

Trump's demand for $5.7 billion in funding for a US-Mexico border wall triggered a historic 35-day partial government shutdown, which ended on Jan. 25. Trump has threatened to resume the shutdown if he is dissatisfied with the negotiations.

Meanwhile, Dallas Federal Reserve President Robert Kaplan said on Tuesday that the Fed should leave interest rates where they are until the US economic outlook is clearer, a process that in his view could take several more months.