AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.
1/6/2020: Gold jumps on Middle East tensions
Source: Bill Musgrave, American Gold Exchange
Austin — Gold jumped 1.1% to close above $1,568, near a seven-year high, as a sharp escalation in Middle East tension propelled safe-haven demand. It was the metal's ninth straight winning session.
Outraged by the US drone attack last week that killed Iranian General Suleimani in Bagdad, the Iraqi Parliament passed a nonbinding resolution to oust American troops from bases in its country. President Trump responded by threatening " sanctions like they've never seen before ever."
With tensions in the region already at the highest since the Iraqi, the President also warned Iran that any retaliation for the Suleimani killing would result in US attacks on 52 Iranian sites, some of which are important cultural centers. Iran announced that it will no longer abide by any strictures from the 2015 nuclear pact and will accelerate its pursuit of nuclear weapons.
The dollar fell 0.2% against major rivals led by the Swiss franc, which is considered a safe-haven currency. Also pressuring the buck, the minutes from the Fed's December meeting indicated that interest rates will remain low for "a time."
Lower rates pressure the dollar by making it less attractive for Forex investors seeking yield. In turn, a lower dollar supports gold by making it less expensive overseas.
Gold has already risen 3% in the brief New Year after closing 2019 with a gain of nearly 19%, its best year since 2010.
The other precious metals were mostly higher, with silver and palladium rising 0.2% and 1.7%, respectively, while platinum fell 2.4%.
At the Comex close: February gold gained $16.40 to $1,568.80; March silver added 3 cents, to $18.18; April fell $24.10 to $966.20; and March palladium jumped $33.90 to $1,989.60 an ounce.
Metal | Ask | Change | |
---|---|---|---|
Gold | $2,373.04 | $-15.72 | |
Silver | $28.35 | $0.07 | |
Platinum | $953.65 | $-14.11 | |
Palladium | $1,066.95 | $13.96 |