Gold prices gain on economic worries after Brexit vote

By: | Published: June 29, 2016 7:46 AM

Gold rose early on Wednesday after dropping about a percent in the prior session, as concerns of uncertainty across financial markets...

GoldSpot gold was at its highest relative to platinum on record this week as institutional and retail investors have piled into bullion following Britain’s shock vote to exit the European Union. (Reuters)

Gold rose early on Wednesday after dropping about a percent in the prior session, as concerns of uncertainty across financial markets in the aftermath of Britain’s vote to exit the European Union continued to burnish the metal’s safe-haven appeal.

Spot gold rose 0.3 per cent to $1,315.51 an ounce by 0100 GMT, up for a third session in four. It fell on Tuesday as investors booked profits after a Brexit-driven rally that pushed prices up to their highest since March 2014.

Also Read: Oil prices rise on Norway strike threat; Brexit shock fades

US gold was up 0.1 per cent at $1,318.80.  Spot gold was at its highest relative to platinum on record this week as institutional and retail investors have piled into bullion following Britain’s shock vote to exit the European Union.

Gold, which hit a more than two-year top of $1,358.20 on Friday, has risen 24 percent so far this year.  European leaders have asked Britain to act quickly to resolve the political and economic confusion unleashed by its vote to exit the European Union, after the IMF said the uncertainty could pressure global economic growth.

Britain’s vote to leave the bloc could pose a new drag on the U.S. economy at a time when momentum in the US job market may already be slowing, Federal Reserve governor Jerome Powell said on Tuesday.

The pound and the euro hovered above their post-Brexit lows as a brief short-covering spell lent a semblance of stability to the battered European currencies, though they remained hampered by longer-term uncertainty.

Japan’s retail sales fell more than expected in May in a third straight month of annual declines, keeping policymakers under pressure for more stimulus to support a fragile economic recovery.

 

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