October 10, 2019
Gold rises to 1 week peak amid trade anxiety
(Reuters) - Gold prices scaled one-week highs on Thursday, holding ground above $1,500 an ounce, as investors flocked to the safety of bullion following contradictory reports about Sino-U.S. trade talks.
Spot gold gained by 0.2% to $1,508.82 per ounce, as of 0412 GMT, having notched a one-week peak of $1,516.77 early in the session. U.S. gold futures inched 0.1% higher to $1,514.
"There is a possibility that trade talks may not have good results, and the bottom line is it will take long. So you may want to buy gold," said Argonaut Securities analyst Helen Lau, adding that some volatility could be expected in the market.
The New York Times reported Washington will soon issue licences allowing some U.S. firms to supply non-sensitive goods to China's Huawei Technologies, while Bloomberg reported the White House is looking at rolling out a previously agreed currency pact with China.
Asian stocks came off early lows as some reports raised hopes that the United States and China would settle some economic disputes.
The South China Morning Post reported the Chinese delegation was planning to leave Washington after just a day of minister-level meetings, instead of as planned on Friday.
Gold is often used by investors as a hedge against political and financial uncertainty.
"Gold ETF holdings are at three-year highs and lots of central banks are also buying, which is keeping prices supported," Lau added.
Indicative of investor interest, holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, have been at their highest since November 2016.
Spot gold looks neutral in a range of $1,488-$1,514 per ounce, and an escape could suggest a direction, said Reuters technical analyst Wang Tao.
"Global trade uncertainties along with subdued global growth will remain supportive towards safe-haven assets in the current term," Phillip Futures analyst Benjamin Lu said in a note.
Among other precious metals, silver rose 0.8% to $17.84 per ounce, palladium dropped 0.2% to $1,679.03 and platinum eased 0.1% to $890.71 an ounce.