Gold climbs to over 6-month peak on global slowdown fears

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Published: January 4, 2019 8:20:01 AM

Gold prices rose to a fresh 6-1/2 month high on Friday as tumbling share markets on the back of weak U.S. data fanned fears of a global economic slowdown, putting the safe haven metal on track for a third weekly gain.

Gold climbs to over 6-month peak on global slowdown fears

Gold prices rose to a fresh 6-1/2 month high on Friday as tumbling share markets on the back of weak U.S. data fanned fears of a global economic slowdown, putting the safe haven metal on track for a third weekly gain.

FUNDAMENTALS

* Spot gold gained 0.3 percent to $1,297.20 per ounce by 0112 GMT, having earlier touched its highest since mid-June at $1,298.34. The metal has risen more than 1 percent so far this week.
* U.S. gold futures were up 0.3 percent at $1,298.70 per ounce.
* The dollar index, which tracks the greenback against a basket of major currencies, edged lower in early Asian trade.
* Global markets were on edge on Friday as dire U.S. economic data slammed Wall Street and pushed investors to bet the Federal Reserve could reverse its policy tightening before the end of this year.
* Survey data from Institute for Supply Management (ISM) showed that U.S. manufacturing activity slowed sharply to a two-year low in December.
* The benchmark U.S. 10-year government note yield fell on Thursday.
* Markets are awaiting the December payrolls report on Friday and will look for clues on U.S. interest rates when Federal Reserve Chair Jerome Powell meets former Fed chairs Janet Yellen and Ben Bernanke later in the day.
* Democrats wasted no time flexing their new power in the U.S. House of Representatives on Thursday as they manoeuvred to pass legislation backed by new Speaker Nancy Pelosi that would end a 13-day partial government shutdown while ignoring President Donald Trump’s demand for $5 billion for a border wall.
* A second referendum on Britain’s membership of the European Union would only exacerbate divisions among the British people, Brexit minister Stephen Barclay told a German newspaper.
* Holdings of SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, rose to 795.31 tonnes, their highest since early August, indicating investor appetite for the precious metal.

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