Yahoo Finance Gold Prices Set to Snap 3-Day Losing Streak as Geopolitical Uncertainty Spikes
Investing.com – Gold prices rose on the Thursday as an uptick in political uncertainty in Spain weighed on risk sentiment while ongoing dollar weakness added to upside momentum in the precious metal.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange rose $7.48, or 0.58%, to $1,290.48 a troy ounce.
Gold prices were on track to snap a three-day losing streak benefitting from political uncertainty in Spain after Spanish Prime Minister Mariano Rajoy said the country would trigger Article 155 allowing the government to take control of Catalonia after Catalan Leader Carles Puidgemont failed to renounced the region’s push for independence.
Also supporting demand for gold was a slump in the dollar amid a fall in treasury yields despite data pointing to underlying strength in the U.S. economy.
The Philadelphia Fed said Thursday its manufacturing index rose to a reading of 27.9, from 23.8 in September, beating economists forecast of a reading of 22.
The U.S. Department of Labor reported Thursday that initial jobless claims decreased 22,000 to a seasonally adjusted 222,000 for the week ended Oct. 13, beating forecasts of a 4,000 decrease.
Sentiment on the gold, however, remained negative as market participants said the precious metal could come under pressure amid signs of solid U.S. economic growth and expectations for a year-end interest rate hike.
"The lack of safe-haven demand combined with expectations of higher interest rates is weighing on gold. If gold remains below $1,300, there's a risk of a deeper correction in the coming days or weeks," said Fawad Razaqzada, an analyst at FOREX.com
Gold is sensitive to moves higher in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
In other metals trading, silver futures rose 1.48% to $17.25 while platinum futures gained 0.16% to $926.10.
Copper traded at $3.17, down 0.35% while natural gas fell by 0.04% to $2.85.
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