Gold hits six-month peak on global economy worries, U.S. government shutdown

By Sethuraman N R BENGALURU (Reuters) - Gold rose to six-month highs on Wednesday as investors kept purchasing the precious metal as a safe haven against an uncertain global economy, volatile financial markets, a partial U.S.

Reuters December 27, 2018 00:05:55 IST
Gold hits six-month peak on global economy worries, U.S. government shutdown

Gold hits sixmonth peak on global economy worries US government shutdown

By Sethuraman N R

BENGALURU (Reuters) - Gold rose to six-month highs on Wednesday as investors kept purchasing the precious metal as a safe haven against an uncertain global economy, volatile financial markets, a partial U.S. government shutdown and U.S. President Donald Trump's criticism of the Federal Reserve.

Spot gold rose 0.8 percent to $1,278.81 per ounce at 11:26 a.m. EST (1626 GMT). It touched $1,279.06, its highest since June 19 earlier. U.S. gold futures were up 0.8 percent at $1,281.80 per ounce.

"The big concern for investors is the sell-off we are seeing in equity markets, the comments coming from Trump over the Federal Reserve and whether the Fed's independence is going to be under pressure now," said David Song, an analyst at DailyFX.

With investors still worried about the global economy and corporate profits, the U.S. dollar and equities pared early gains. Roughly three-fourths of S&P 500 stocks were in bear market territory.

The partial shutdown of the U.S. federal government over Trump's demand for border wall funding and the president's criticism of the Fed have unnerved investors. Other concerns included the departure of U.S. Defense Secretary James Mattis and U.S.-China trade tensions.

"We are near-term constructive on gold,". Song said. "There are concerns about global growth in 2019, global geo-political uncertainties and Trump's continued attack on the Federal Reserve and how long the government shutdown will continue in the U.S."

Spot gold is up 4.7 percent for the month thus far, on track for its biggest December gain in about 10 years.

Gold is seen as a hedge against political and economic worries. Holdings of SPDR Gold, the largest gold exchange-traded fund, are at their highest point since August and have risen about 6 percent since touching more than 2-1/2-year lows in October.

"Gold is printing day's highs as the U.S. dollar dips with markets continuing to scale a wall of worry," said Tai Wong head of base and precious metals derivatives trading at BMO.

"Gold looks like it's breaking out higher with a short term target of $1,300 and medium term target of $1,360-$1,370. More importantly the algorithmic trading programs which are practically all momentum followers will continue to push gold higher as the trend remains clearly up."

Among other metals, silver gained 2.9 percent to $15.16 per ounce, its highest since Aug. 13.

Platinum was up 2.1 percent at $799.30. Palladium was up 0.2 percent at $1,248.30 per ounce.

(Reporting by Nallur Sethuraman and K. Sathya Narayanan in Bengaluru; Editing by Robin Pomeroy and David Gregorio)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Oil rises 2% as OPEC complies with production cuts
Business

Oil rises 2% as OPEC complies with production cuts

By Jessica Resnick-Ault NEW YORK (Reuters) - Oil prices strengthened on Wednesday, as OPEC and its allies were seen complying with a pact to cut oil supply in September, even as concerns loomed that recovery in fuel demand will be stalled by soaring global coronavirus cases. Early in the day crude was boosted by a bullish stock market. Even as equities whipsawed on pandemic worries, oil stayed higher, buoyed by expectations that OPEC could staunch a supply glut

Tesla's back-to-back price cuts bring sticker on U.S. Model S below $70,000
Business

Tesla's back-to-back price cuts bring sticker on U.S. Model S below $70,000

By Tina Bellon and C Nivedita (Reuters) - Tesla Inc will further cut the price of its Model S "Long Range" sedan in the United States to $69,420, the electric carmaker's chief executive, Elon Musk, announced in a tweet https://bit.ly/2H0JCP0 on Wednesday. The anticipated drop marks the second time this week Tesla has cut the price for the high-end sedan, following a 4% cut of the Model S's price in the United States on Tuesday to $71,990.

Trump cites teenaged son's bout with coronavirus in calling for schools to reopen
World

Trump cites teenaged son's bout with coronavirus in calling for schools to reopen

By Jeff Mason DES MOINES, Iowa (Reuters) - Under siege over his handling of the novel coronavirus pandemic, President Donald Trump on Wednesday cited what he said was his son's mild bout of the virus as a reason why American schools should reopen as soon as possible. Trump made the comment about his son, Barron, as the president swept into Iowa on a mission to shore up support in battleground states that he won in 2016 but is in danger of losing to Democrat Joe Biden barely three weeks before the election. First lady Melania Trump announced in a statement earlier in the day that the virus that struck both her and her husband had also infected their 14-year-old son