Gold price edges up on geopolitical uncertainty

Jan 10, 2017 - 10:53 AM GMT
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The gold price edged higher on the morning of Tuesday January 10 in London, supported by safe-haven demand stemming from geopolitical uncertainty.

The spot gold price was recently quoted at $1,184.10/1,184.40 per oz, up $1.35 on the previous close. 

“The global inflationary implications of the higher Chinese PPI may well help underpin gold prices, especially with the geopolitical uncertainty surrounding the president-elect Donald Trump’s inauguration and with more talk of a hard Brexit,” Metal Bulletin analyst William Adams said. 

“As well, if inflation fears pick up, other markets such as equities and bonds may struggle, which could also stimulate demand for safe-haven assets,” he added. 

Gold investors are likely to monitor political developments more closely as Trump’s inauguration date of January 20 nears, HSBC analyst James Steel said.

“Any significant ratcheting higher in geopolitical tensions could help trigger safe-haven bullion demand,” he added.

Silver price flat, PGMS mixed 

  • In the other precious metals, the spot silver price was effectively flat at $16.590/16.630 per oz.
  • The spot platinum price was $4 lower at $968/973 per oz but spot palladium was unchanged at $754/759 per oz.

Currency moves and data releases 

  • The dollar index stood at 101.79 as of 09.40 London time, down 0.03% from yesterday’s close. 
  • Chinese consumer price inflation (CPI) for December fell to an annual rate of 2.1% from 2.3% in the preceding month. A reading of 2.2% had been expected. 
  • China’s PPI for December at 5.5% was stronger than the expected 4.6% and up from November’s rate of 3.3%. 
  • French industrial production at 2.2% was better than the forecast 0.5%. 

 

(Editing by Mark Shaw)