Gold close to one-year highs due to tension with North Korean
The dollar is down as delays in interest-rate increases are expected, which is a plus for gold
London — Gold rose towards one-year highs on Wednesday, boosted by tensions on the Korean peninsula and a lower dollar due to growing expectations that the US Federal Reserve will delay rate rises. Spot gold was little changed at $1,340.12 an ounce at 9.37am GMT, a gain of about 8% so far this quarter and more than 16% so far this year. It touched $1,344.21 an ounce on Tuesday, its highest since September 8. US gold futures were up 0.1% at $1,345.2 an ounce. "Rising geopolitical tensions, the hurricane hitting the US, and the looming debt ceiling are increasing demand for safe assets," said Danske Bank analyst Jens Pederson. "These extraordinary factors are also weakening the dollar from the point of view that the Fed may further postpone normalisation of monetary policy, which would be good news as it would keep a lid on US yields." Both US government bonds and gold are seen as risk-free by investors. Low US Treasury bond yields mean there is little opportunity cost in holding gold...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.