Friday, 16 November 2018

Gold prices hit 1-week high amid Brexit turmoil


Gold prices rose on Friday, having hit a one-week high earlier in the session, as investors sought safe-haven assets amid fears of a chaotic departure for Britain from the European Union.

UK Prime Minister Theresa May's draft Brexit plan ran into dispute after the resignation of key ministers from her government and eurosceptic lawmakers stepped up efforts to topple her, provoking fears the country could crash out of the EU without a divorce deal.

"The issues around Brexit have invigorated a little bit of safe-haven buying in the market ... The focus of the market has turned slightly to geopolitical issues at the moment," said ANZ analyst Daniel Hynes.

Spot gold was up 0.2 percent at $1,215.07 per ounce, as of 0445 GMT. Earlier in the session, the bullion hit $1,216.79, its highest since Nov. 9.

U.S. gold futures were flat at $1,215.3 per ounce.

"Gold should continue to find demand on dips, provided the U.S. dollar remains in check," Stephen Innes, APAC trading head at OANDA in Singapore said in a note.

The dollar index, which measures the greenback against a basket of six major currencies, was at 97, not far from a 16-month high of 97.69 hit at the start of the week.

A softer dollar, GBP notwithstanding and the U.S. Federal Reserve triggering some early warning signals about global growth risk in 2019, combined with political tensions are being viewed in a positive light for the gold market, Innes added.

Investors also kept an eye on the U.S.-China trade tensions as they looked for concrete signs the economic powers were seeking to de-escalate their dispute.

Spot gold may edge up to $1,223 per ounce, to complete a bounce triggered by a channel support around $1,192, said Reuters technical analyst Wang Tao.

Among other precious metals, palladium edged 0.3 percent lower to $1,153.50 per ounce, having hit a record high of $1,178.30 per ounce in the previous session.

Palladium is on track to mark its biggest weekly gain since Sept. 21 having risen over 3 percent so far.

Silver was little changed at $14.29 per ounce. The metal rose about 1 percent so far this week.

Platinum climbed 0.1 percent to $842.30 an ounce and was down about 1 percent for the week so far.

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Source: MoneyControl

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