Gold bides time as traders await clarity on Brexit

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Published: October 23, 2019 8:34:17 AM

Spot gold was unchanged at $1,488.50 per ounce, as of 0125 GMT.

Gold prices, Boris Johnson, brexit divorce, US gold futures, trade war, US gold futures, SPDR Gold TrustAsian shares and U.S. stock futures took a hit after British lawmakers rejected the government’s proposed timetable for passing legislation to ratify its deal to exit the European Union. (Reuters photo)

Gold prices were steady on Wednesday, as investors waited for clarity on Brexit confusion after UK lawmakers voted for Prime Minister Boris Johnson’s divorce plan but opposed his tight timetable to complete the legislative process in three days.

FUNDAMENTALS

* Spot gold was unchanged at $1,488.50 per ounce, as of 0125 GMT. U.S. gold futures rose 0.3% to $1,491.30 per ounce.

* EU leaders should delay Brexit after Prime Minister Boris Johnson paused legislation on his deal following a parliamentary defeat, EU Council President Donald Tusk said on Tuesday, as Britain spins towards a possible election to break the impasse.

Also read: Oil slips after US inventory build, but possible OPEC cuts support market

* Asian shares and U.S. stock futures took a hit after British lawmakers rejected the government’s proposed timetable for passing legislation to ratify its deal to exit the European Union.

* Meanwhile, Federal fund futures imply that traders see a 91.4% chance for a 25 basis point rate cut by the U.S. central bank in its month-end monetary policy meeting.

* On the trade war front, China and the United States have achieved some progress in their trade talks, Vice Foreign Minister Le Yucheng said on Tuesday, adding that as long as both sides respected each other, no problem could not be resolved.

* White House economic adviser Larry Kudlow on Monday expressed optimism about ongoing U.S.-China trade talks, and said that tariffs scheduled for December could be withdrawn if negotiations continue to go well.

* The two major economies have imposed a series of tit-for-tat tariffs over the past 15 months that have hit financial markets and stirred up global recessionary fears.

* The non-yielding bullion is often seen as a safer investment during times of political and financial uncertainty.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.54% to 919.66 tonnes on Tuesday from 924.64 tonnes on Monday.

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