Gold continued its unabated rally, with prices reaching a six-year high on Tuesday as a weaker dollar on rate cuts hopes, lingering trade worries and simmering U.S.-Iran tensions boosted the appeal of precious metal as a safe-haven asset.
Spot gold rose 0.7 percent to $1,429.87 an ounce, after hitting its highest level since May 2013 at $1,438.63 earlier in the day. U.S. gold futures were up over 1 percent at $1,433 an ounce.
The precious metal is extending gains for the sixth day and is up 10 percent so far this month on mounting U.S.-Iran geopolitical risks.
The United States imposed new sanctions on Iran aimed at preventing some top Iranian officials from using the international banking system or any financial vehicles set up by European nations or other countries.
Sharply criticizing the new sanctions, Iran said the measures spell the “permanent closure” for diplomacy between the two nations.
Meanwhile, U.S. President Trump will meet Chinese President Xi Jinping at the G20 summit in Osaka, Japan this weekend.
The president is “comfortable with any outcome” from the talks, a senior U.S. official reportedly said on Monday, raising questions about whether the two sides will make any progress on trade at the G20 meeting beginning on Friday.
Today’s speeches by Fed chair Jerome Powell as well as James Bullard could serve as fresh catalysts to keep the gold rally going.
The material has been provided by InstaForex Company – www.instaforex.com
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