Gold prices climb over concerns about U.S. political uncertainty
BENGALURU (Agencies):Gold prices climbed on Monday, holding ground near a six-month high hit last week, as investors remained concerned about political uncertainty in the United States and global economic slowdown.
Spot gold was up 0.6 percent at $1,263.91 per ounce as of 0458 GMT. The metal had hit its highest since early July at $1,266.40 on Thursday.
U.S. gold futures were up 0.7 percent at $1,267.4 per ounce.
A partial U.S. government shutdown was almost certain to drag through the Christmas holiday after the Senate adjourned on Saturday without breaking an impasse over President Donald Trump’s demand for more funds for a border wall.
Signs of political instability in the United States at a time when the global economy is weakening sent equities sliding, further boosting demand for gold.
The Japanese yen and the Swiss franc, which are considered a safe bet during times of economic and political stress, also gained as investors’ appetite for risk assets waned.
Also supporting the bullion was speculation that the U.S. Federal Reserve could adopt a less aggressive monetary policy going forward, said Shah.
Fed Chairman Jerome Powell had said last week that policymakers would be “patient” in determining future rate hikes amid expectations the U.S. economy will slow next year and inflation likely to stay below the Fed’s 2 percent target next year.
Fresh economic forecasts showed officials at the median now see only two more rate hikes next year compared to the three projected in September.
Hedge funds and money managers raised their net long positions in Comex gold to a six-month high in the week to Dec. 18, indicating improved interest in the metal.
Also, holdings of the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.5 percent to 772.67 tonnes on Friday.
Among other metals, palladium inched 0.1 percent higher to $1,233.00 per ounce.
Silver rose 0.9 percent to $14.73, while platinum gained 0.6 percent to $791.70 per ounce.