Gold hits strongest in a week as Trump comments shake greenback

NEW YORK/LONDON — Gold jumped to a one-week high on Tuesday as unnerved investors bought bullion after the dollar was hit by US President Donald J. Trump’s comments on currency devaluation by other countries.

Spot gold climbed 1.40% to $ 1,211.15 an ounce by 3: 30 p. m. EST (2030 GMT) after tapping its highest since Jan. 24 at $1,215.37. It was on track to close January up 5.20%, its strongest month since June.

US gold futures settled up 1.30% at $1,208.60.

The US dollar tumbled while stocks cemented their biggest losses in six weeks as Mr. Trump added uncertainty to the market following stringent curbs on travel to the United States.

The greenback was already weaker after Mr. Trump sacked top US Government Lawyer Sally Yates, who refused to defend his curbs on travel targeting seven Muslim-majority nations.

“Clearly Trump remains the main driver for gold. He has really turned from being a bit of a foe of gold to a friend with the uncertainty of his policies,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

“We’re not getting any news on fiscal spending and tax cuts. Instead, we’re hearing about protectionism and a tough stance on immigration. That’s unnerving the market.”

A weaker dollar supported bullion, though traders were also eyeing a two- day Federal Reserve meeting that started during the session, with a statement due on Wednesday at 2 p. m. EST ( 1900 GMT), hoping for clues on the outlook for US interest rates.

“The big risk this week ultimately is really going to be what the dollar does and a lot of that is going to hinge on what does and doesn’t come out of tomorrow’s FOMC meeting,” Credit Suisse Analyst Christopher Hine said.

Higher rates could strengthen the US currency, making dollar- denominated gold more expensive for holders of other currencies and potentially dampening demand. “The dollar is weaker today and yields are coming in as well,” said Paul Wong, senior portfolio manager for Sprott Asset Management in Toronto, about key factors buoying gold prices.

In other precious metals, spot silver was up 2.60% at $17.55 an ounce after hitting the highest since Nov. 11 at $17.61.

“Silver has broken out of its established bearish channel to move above key resistance in the $17.15/25 range,” said Fawad Razaqzada, technical analyst for Forex. com. “Silver’s technical breakthrough comes ahead of gold, which clearly underscores its outperformance.”

Platinum rose 0.80% to $993.40, while palladium was up 1.90% at $754.20. —