Gold breached the psychological $1,200 an ounce barrier on Monday (16 January), as fears over the incoming Donald Trump administration being the most protectionist in US history sent investors seeking safe-haven assets.
In recent weeks, the US president-elect has taken pot shots at automakers and intelligence agencies. At 3:05pm GMT, the Comex gold futures contract for February delivery was up 0.55% or $6.60 at $1,202.90 an ounce, while spot gold was 0.53% or $6.39 higher at $1,203.82 an ounce, Brexit uncertainty and a weaker dollar lending further support to the yellow metal.
FXTM chief market strategist Hussein Sayed said: “So far gold has recovered 6.8% from December lows, and traded higher in 11 out of 13 business days. Trump’s antics have certainly helped bullish sentiment.”
In step with the futures market, physical traders have also been reporting higher volumes. London-based bullion firm The Pure Gold Company said its takings had jumped 69% in the first two weeks of 2017.
Josh Saul, chief executive officer of the Pure Gold Company, said over 71% of its clients have cited concerns about significant volatility across equity markets and the potential for considerable declines in property values (in the UK, Europe and US) over the coming weeks and the rest of 2017, as being the reason for upping their gold purchases.
“Many appear to be very worried. Once Trump is elected they fear interest rate hikes even while household debt is at record highs, the impact of geopolitical tensions between the US, China and Russia, the conflict between Trump and the intelligence services and the fear of currency devaluations.”
