Gold Hits Two-month High as North Korea Wor­ries Drive Haven De­mand

Spot gold touched $1,286.40, high­est level since June 8

The Economic Times - - Finance & Commodities -

Lon­don: The price of gold climbed to the high­est lev­els in two months on Thurs­day as the United States and North Korea ex­changed more threats, prompt­ing in­vestors to buy bul­lion as a safe haven as­set.

“For now, the up­trend is very much in­tact in gold, re­act­ing to ex­ter­nal geopo­lit­i­cal events,” said Jonathan But­ler, com­modi­ties an­a­lyst at Mit­subishi.

The spot gold price was up 0.7% at $1,286.07 per ounce by 1400 GMT, af­ter hit­ting an ear­lier high of $1,286.40, its high­est level since June 8. The price rose 1.3% in the pre­vi­ous ses­sion, the big­gest gain since mid-May.

US gold fu­tures for De­cem­ber delivery climbed 1% to $1,291.80.

Gold ex­tended gains af­ter data showed US pro­ducer prices un­ex­pect­edly fell in July, record­ing their big­gest drop in nearly a year and point­ing to a fur­ther mod­er­a­tion in in­fla­tion that could de­lay a Fed rate in­crease. The mar­ket was wait­ing for US con­sumer in­fla­tion data on Friday that would of­fer more clues about fu­ture Fed de­ci­sions. The $1,279 area is a key tech­ni­cal level, rep­re­sent­ing a down­trend that has been in force since mid-2016 when gold surged to a two-year peak of $1,374.91.

Spec­u­la­tive po­si­tions in US gold fu­tures re­main sub­dued, said UBS strate­gist Joni Teves.

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