Published: Sun, August 11, 2019
Markets | By Erika Turner

Gold breaches $1,500 ceiling in beeline to safe havens

Gold breaches $1,500 ceiling in beeline to safe havens

Gold prices on Wednesday surged Rs 1,113 to hit an all-time high of Rs 37,920 per 10 gram in the national capital on sustained buying from jewellers amid strong trend overseas as fresh trade tensions between the U.S. and China prompted investors to move towards gold as safe haven asset.

With more and more global investors turning risk averse, gold prices continued to head north and reached a level of $1500 per ounce on Wednesday.

Meanwhile, globally, spot gold was trading marginally lower Dollars 1,497.40 an ounce in NY, while silver was trading at USD 17.16 an ounce.

Indicative of sentiment, SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.21% to 836.92 tonnes on Tuesday from 835.16 tonnes on August 5.

Gold has been one of the chief beneficiaries of the turmoil in global financial markets as Washington and Beijing spar over trade.

A Federal Reserve official said on August 6 it was appropriate to "wait and see" how the upcoming data was, before deciding whether rates should be cut again at the central bank's next meeting in September.

We're All Ready - Tottenham Star Steeled For Season Opener Against Aston Villa
Tottenham midfielder Dele Alli has been ruled out of the start of the new Premier League season with a hamstring injury. Tottenham have reached a club-to-club agreement with Real Betis to sign midfielder Giovani Lo Celso .

Gold is considered a safe haven asset and investors traditionally buy into the precious metal at times of economic or political instability.

Silver, gold's cheaper cousin, also surged. Silver also surged, with futures rallying as much as 3 per cent to US$16.935 an ounce, the highest in more than a year.

Also fuelling gold's rally was a slump in U.S. Treasury yields and Wall Street, with the Dow Jones Industrial Average tanking more than 300 points. Lower interest rates further boost the appeal of gold.

In a related but unexpected development, central banks in New Zealand, India and Thailand all announced key interest rate cuts on Wednesday.

Gold prices have been surging for the last few days and had hit Rs 36,970 mark on Monday.

China's exports likely declined for a second successive month in July, according to a Reuters poll, signalling a hit from tariffs in the escalating trade war.

Like this: