Gold climbs to near 2-week high

By Reuters News Agency. Published at Apr 11, 2019, in Market Wrap

Gold rose on Wednesday, lifted to their highest in almost two weeks as investors fretted about the global economy and trade tensions, and as the European Central Bank and the US Federal Reserve showed signs that monetary policy will remain accommodative writes Nallur Sethuraman.

Spot gold was up 0.4 percent at $1,308.47 an ounce on Wednesday. Prices hit their highest since March 28 at $1,310.50 during the session.

US gold futures settled 0.4% higher at $1,313.90.

Gold drew support from political and economic worries such as the Brexit, US politics and trade tensions between Washington and China and the Euro Zone, said George Gero, managing director at RBC Wealth Management.

European Central Bank President Mario Draghi raised the prospect of more support for the struggling euro zone economy on Wednesday. Minutes of the Fed's latest meeting showed a patient stance on interest rate hikes. Analysts said these factors supported gold prices.

Minutes of the Fed's March 19-20 meeting showed policy makers saw the US economy weathering a global slowdown, with no recession for the United States in the next few years.

Lower interest rates reduce the opportunity cost of holding non-yielding gold, which is seen as a safe haven during times of political and economic uncertainty.

US consumer prices increased in March by the most in more than a year, but underlying inflation remained benign against the backdrop of slowing domestic and global economic growth.

World stocks inched up but remained below the six-month high reached earlier this week, as investors worried about US President Donald Trump threatening more tariffs against the European Union.

Higher stock indexes worldwide have constrained some buying in safe-haven metals, said Jim Wyckoff, senior analyst at Kitco Metals.

"If the monetary policies are going be easing around the world then the financial system would be much more liquid, which might augur some buying in commodities," Wyckoff said.

While gold prices are above $1,300, investors are looking for more reasons to buy the metal, analysts said.

Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, fell for the seventh consecutive session on Tuesday and are at their lowest level since November.

In other metals, spot platinum climbed 1.6 percent to $901.25 an ounce. On Monday it touched its highest since last May at $914.74.

Palladium fell 0.1 percent to $1,387.51, while silver firmed by 0.2 percent to $15.24.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Thanks for subscribing!

X