Gold Climbs to Highest at $1,300.80 per Ounce

Window display of jewelry shop

Gold surged to its highest in more than nine months on Friday, August 18, as the dollar retreated on political uncertainty in the United States and a suspected Islamist attack in Spain boosted bullion’s safe-haven appeal.

Spot gold touched its highest since Nov. 9 at $1,300.80 per ounce, and by 1333 GMT was trading up 0.8 percent at $1,298.51.

“There is clearly more for financial markets to be concerned about,” Danske Bank analyst Jens Pedersen said, referring to U.S. political uncertainty and the attack in Spain. “That has
led to a risk-off environment, and that’s supportive for gold.”

Spain mounted a sweeping anti-terrorism operation on Friday after a suspected Islamist militant drove a van into crowds in Barcelona, killing 13 people in what police suspect was one of a planned wave of attacks.

U.S. gold futures for December delivery were up 1percent at $1,305.

“The discord coming out of Washington could prove supportive for gold as well, as this could pressure the dollar further, just as the Fed is casting fresh doubts about its (interest)
rate timetable,” said INTL FCStone analyst Edward Meir.

Policymakers in Europe and the U.S. expressed concerns about unwinding monetary stimulus too soon.

Gold is sensitive to rising interest rates because they push up bond yields, increasing the opportunity cost of holding non-yielding bullion while tending to strengthen the dollar, in
which gold is priced.

Spot gold faces resistance at $1,291 an ounce and could hover below this level or retrace towards support at $1,271 again, said Reuters technical analyst Wang Tao.

Among other precious metals, silver climbed 1 percent to $17.17 an ounce, having touched a two-month high of $17.25.

Platinum was up 1.2 percent at $974.80, on track for a third straight week of gains.
Palladium touched a 16-year high of $934 before giving back some gains to trade 0.2 percent up at $927, on course for a weekly gain of about 4 percent.

 

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