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Ukraine and Gaza push gold to third gaining day
Escalating tensions in Ukraine have pushed gold to to its fourth increase in four sessions as the safe haven is gaining back its appeal.
Futures for the precious metal with a delivery date in December were at $1,315.50 per ounce after adding on 0.3% to prices early afternoon in New York’s Comex. Prices for an ounce of gold have so far climbed by 9.4% this year and hit a 16 week high of $1,346.80 earlier this month on July 10th on the back of unrest in Europe and the Middle East.
John Kerry, the US Secretary of State, claimed yesterday that there was a significant amount of circumstantial evidence showing Russia as partly responsible for the Malaysian Airlines passenger plane that crashed last week. Kerry points to the country’s role in supplying separatist rebels the missile that brought the plane down. Leaders from the European Union will meet tomorrow in Brussels to discuss tougher sanctions on the country.
Persistent violence in Gaza as Israeli forces continue their ground assault are also contributing for the demand in safe assets such as gold. Precious metals strategist and vice president of RBC Capital Markets George Gero says that, “There are enough fundamentals to keep prices over $1,300 for some time.”
Gold saw its six week streak of gains, its longest rally in almost three years, end last week when it lost 2% behind renewed interest rate hike speculation spurred by the Federal Reserve. It dropped the most in three decades by 28% in 2013 when the central bank first suggested tapering off its monetary policy.
