June 7, 2017 / 4:38 AM / a year ago

REFILE-PRECIOUS-Gold holds near 7-mth high as political worries buoy safe-haven demand

 (Refiles to correct date)
    * UK elections, Comey testimony, ECB meeting support demand
    * Gold holds near Tuesday top of $1,295.97, highest since
Nov 2016
    * Palladium holding close to near 3-yr high

    By Vijaykumar Vedala
    BENGALURU, June 7 (Reuters) - Gold edged lower on Wednesday,
although still holding near its highest in seven months,
supported by a weaker dollar ahead of key political and economic
events that are expected to stoke bullion's safe-haven appeal. 
    A national election in the UK, a European Central Bank
policy meeting and former U.S. Federal Bureau of Investigation
(FBI) director James Comey's Senate testimony are all occurring
on Thursday.             
    The events have the potential to boost the appeal of
bullion, which is often used as an investment option during
times of political and financial uncertainty.
    A combination of geopolitical concerns, including the UK
elections and a wilting U.S. dollar as Wall Street loses faith
on U.S. President Donald Trump delivering on his campaign
promises, have kept gold's bullish streak going, said Jeffrey
Halley, a senior market analyst at OANDA. 
    "With the degree of uncertainty around as we head into the
latter half of the week, there would appear to be no reason for
gold's march higher to peter out," Halley said. 
    Spot gold        fell 0.1 percent to $1,291.66 per ounce at
0350 GMT. On Tuesday, it rose 1.1 percent and hit its highest
level since November last year at $1,295.97 an ounce.
    U.S. gold futures         for August delivery dipped 0.3
percent to $1,294.2 an ounce. 
    "At $1,290, gold prices look too rich for our comfort. It
has been rallying simply because of safe-haven demand," OCBC
analyst Barnabas Gan said. 
    "Once this driver that underpins the strong gold price
disappears, beyond Thursday and till the end of June, expect
gold to lose its lustre," he said. 
    A U.S. interest rate hike in mid-June should yield a more
expensive greenback and pull gold prices lower, Gan said. 
    British Prime Minister Theresa May looks set to increase her
parliamentary majority in Thursday's election, an opinion poll
showed on Tuesday, although another survey suggested the race
with the opposition Labour Party was neck and neck.             
    Holdings in SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund, on Tuesday rose 0.49 percent
to 855.16 tonnes.          
    The dollar index        held steady against a basket of
major currencies but stayed close to the near-seven month low
hit on Tuesday. 
    Among other precious metals, spot silver        gained 0.1
percent to $17.68, platinum        slipped 0.2 pct to 954.40,
and palladium was up 0.1 pct at $854.30. 
    On Tuesday, palladium hit its highest since September 2014
at $858.70; silver touched a high of $17.75, its strongest since
April 25; and platinum rose to a high of $967.50, highest since
April 24. 

 (Reporting by Vijaykumar Vedala; Additional reporting by
Koustav Samanta; Editing by Joseph Radford and Tom Hogue)
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below