Global gold prices hover near two-month high on North Korea tensions
Spot gold prices had eased 0.1% to $1,276.40 per ounce at 8.22am
Bengaluru: Gold prices on Thursday held steady near 2-month highs hit the session before, bolstered by safe-haven demand triggered by rising tensions on the Korean peninsula.
North Korea dismissed on Thursday warnings by US President Donald Trump that it would face “fire and fury” if it threatened the United States as a “load of nonsense”, and outlined detailed plans for a missile strike near the Pacific territory of Guam.
“(Safe-haven demand) has settled down to a certain extent, but the market is still expecting more news to come,” said Brian Lan, managing director at gold dealer GoldSilver Central in Singapore.
“North Korea doesn’t seem like they’re going to back down and the US has also made a very strong stance this time.”
Geopolitical risk can boost demand for assets seen as safe-havens such as gold.
Spot gold had eased 0.1% to $1,276.40 per ounce at 8.22am. The precious metal climbed 1.3% in the previous session, its biggest gain since mid-May, and touched $1,278.66 an ounce, it highest level since 14 June.
US gold futures for December delivery rose 0.2% to $1,281.90 per ounce on Thursday.
Asian stocks steadied and US Treasury bond prices fell slightly on Thursday as the risk aversion triggered by tensions between the United States and North Korea began to settle.
“Amid all the sabre-rattling, we expect gold prices to continue to move higher and likely cross the $1,300 an ounce mark in relative short order,” said INTL FCStone analyst Edward Meir.
The market was also waiting for data that would offer clues about the extent to which the strengthening U.S. labour market is spilling over into inflation.
“Investors tend to be more cautious ahead of economic data, especially when the prices are high. They might take profits first and wait to see what’s going to happen before they move into the market again,” said GoldSilver’s Lan.
In other precious metals, silver was nearly flat at $16.90 per ounce after hitting its highest since 15 June earlier in the session. Platinum was also almost unchanged at $971.75 per ounce. In the previous session, it marked its highest since 21 April at $980.60.
Palladium prices were flat at $891.00 per ounce. Reuters
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