Safe Haven Gold Demand Underpins Prices
Los Angeles CA, January 3, (Tangible Investments) â€” by James Oâ€™Dell â€” Precious metals prices were mixed on Wednesday as safe haven Gold demand underpins prices. Gold is down 0.14 percent to $1,315.30 an ounce after soaring $14.60 on Tuesday to close at $1,317.10 an ounce.
Silver is down 0.12 percent to $17.13 an ounce after gaining $0.24 on Tuesday to close at $17.15. The Gold/Silver ratio fell to 76.80 as Silver outperformed Gold. Platinum is up 0.74 percent to $949.00 an ounce. Palladium is down 0.55 percent to $1,080.00 an ounce.
Gold dipped in early trading on Wednesday as the dollar recovered from recent lows but safe-haven demand continues to support prices.
â€¦Gold looks â€œto stay supported following a much-needed correction. Dollar weakness and raised inflation expectations following the December U.S. rate hike and tax deal have supported the best run higher in Gold since 2011,â€ said Ole Hansen, of Saxo Bank.
Gold’s move back above its 100-day moving average last week helped to add credence to the uptrend. SP Angel says that there are several factors supporting Gold.
â€œExpectations of a slower pace of interest-rate hikes by the U.S. Federal Reserve helped to boost Gold prices to 3.5 month highs to start 2018,â€ says SP Angel.
â€œKey factors for the bullion market into the year will focus on the rate of normalization of interest rates by the central banks, the length of the current equity rally, the longer-term impact of U.S. tax reforms, and the timing for a pickup in inflation.â€
Seasonal Buying To Pick Up
Meanwhile, Chinese New Year will be celebrated on February 16, 2018 this year, and physical demand from Asia has yet to pick up.
â€œSigns of seasonal Asian buying are yet to be seen in any meaningful way, which does make it difficult to chase this move higher, although we do expect this to begin filtering in over the next week or so,â€ says MKS.
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