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Gold hits highest in over a month on Brexit, Trump concerns

Discussion in 'Gold Silver (All things Metal)' started by Scorpio, Jan 10, 2017.

  1. Scorpio

    Scorpio Скорпион Founding Member Board Elder Site Mgr Site Supporter ++

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    PRECIOUS-Gold hits highest in over a month on Brexit, Trump concerns

    * Gold cashes in on fears around Brexit, Trump
    * SPDR Gold holdings down about 15 pct since U.S. elections
    * Platinum, palladium off highs hit Monday

    (Updates throughout, changes dateline from BENGALURU)
    By Zandi Shabalala
    LONDON, Jan 10 Gold rallied to its highest level
    in more than a month on Tuesday as the dollar dipped on jitters
    before a news conference by U.S. President-elect Donald Trump on
    Wednesday and on Britain's uncertain exit from the European
    The market is looking for more clues on Trump's spending
    plans in the first speech since his shock win in November,
    pushing the dollar lower.
    The pound and stocks also slid on fears of a "hard" Brexit
    after British Prime Minister Theresa May said at the weekend
    she was not interested in Britain keeping "bits" of its EU
    Gold, often seen as an alternative investment during times
    of geopolitical and financial uncertainty, benefited from the
    risk-averse sentiment in the market.
    Spot gold hit its highest since Dec. 5 at $1,187.61
    an ounce and was up 0.2 percent to $1,183.61 an ounce by 1030
    U.S. gold futures climbed 0.1 percent to $1,183.60
    per ounce.
    ABN AMRO commodity strategy Georgette Boele said the
    combination of a soft dollar, lower U.S. yields and risk
    aversion created a supportive environment for gold.
    "We have this Trump conference coming up tomorrow and the
    market seems to be a bit nervous ahead of it," Boele said,
    adding that this sentiment would be short-lived as U.S. interest
    rates are expected to rise at least three times, denting gold.
    Gold is highly sensitive to rising U.S. interest rates,
    which increase the opportunity cost of holding the non-yielding
    asset while boosting the dollar, in which it is priced.
    Strong physical demand from the Chinese new year also buoyed
    prices, said Marex Spectron's head of precious metals David
    "Gold seems to be behaving true to January form at the
    moment, with physical demand picking up ahead of the Chinese
    Lunar new year and investors starting to buy as the great
    unknown of the Trump presidency looms," he said.
    Holdings of SPDR Gold Trust, the world's largest
    gold-backed exchange-traded fund, fell 1.06 percent to 805.00
    tonnes on Monday. The holdings have dropped about 15 percent
    since the November U.S. presidential elections.
    Silver was flat at $16.57 an ounce and platinum
    was 0.4 percent higher at $970. Platinum rose to a
    two-month high of $981.90 an ounce in the last session.
    Palladium was set to gain for the sixth straight
    session, up 0.1 percent at $754.50 an ounce after rising to its
    highest in more than a month on Monday.

    (Additional reporting by Swati Verma and Nallur Sethuraman in
    Bengaluru; Editing by Adrian Croft)


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