Gold heads for best week since June

Gold stayed on track for its strongest week since June on Friday, with prices close to the previous day’s five-month peak, as concerns over North Korea and the Middle East hit the dollar and sent investors scurrying for the safety of bullion.
The world’s biggest gold-backed exchange-traded fund, New York-listed SPDR Gold Shares, said its holdings rose more than 6 tons on Thursday, its biggest one-day inflow in a month, as investors bought into the metal. Spot gold was at $1,286.25 an ounce at 1035 GMT, little changed from $1,287.36 late on Thursday. They peaked that day at $1,288.64 an ounce, the highest since early November.
“The further deterioration in the US relationship with Russia and North Korea this week has supported the prices of precious metals,” Capital Economics said in a weekly note.
“A weaker dollar, in light of President Trump’s comments about the risk to the US economy from a rise in the dollar, has also helped to boost the price of gold.” Market liquidity was thin due to Passover and Good Friday holiday observances around the world. The dollar nursed losses on Friday, heading for its first losing week in three, as continuing tensions in North Korea underpinned currencies seen as safer, such as the Japanese yen.
China said on Friday tension over its neighbor North Korea had to be stopped from reaching an “irreversible and unmanageable stage,” as a US aircraft carrier group headed for the region. Uncertainty over US President Donald Trump’s policy toward North Korea, which has conducted missile and nuclear tests in defiance of sanctions, has been growing since the US Navy fired 59 Tomahawk missiles at a Syrian airfield last week.
“It is very hard to decide which direction gold will go right now,” one trader with a Shanghai-based bullion bank said. “If Trump is to perform some military action against North Korea, gold will definitely reach $1,300.” Adding to geopolitical concerns, the US military said on Thursday that it dropped the largest non-nuclear device it has ever used in combat on a network of caves and tunnels used by Daesh in eastern Afghanistan.
Among other precious metals, silver was up 0.1 percent at $18.52 an ounce, after touching a five-month high of $18.599 in the previous session. Platinum was up 0.2 percent at $971.15 and palladium was 0.1 percent higher at $795.08.

Source: Arab News