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Gold prices rise, head for positive week amid bond market turmoil - INVESTING.COM
BY Ambar Warrick
Investing.com-- Gold prices rose in Asian trade on Friday and were headed for a positive week as safe haven demand was elevated by a sell-off in U.S. Treasuries, amid heightened concerns over high government debt.
The yellow metal also benefited from some talk of worsening conditions in the Middle East, especially between Israel and Iran, although these concerns were quelled by the U.S. announcing more nuclear talks with Tehran.
Spot gold rose 0.8% to $3,320.68 an ounce, while gold futures for June rose 0.8% to $3,320.49/oz by 01:27 ET (05:27 GMT).
Spot gold trading higher than futures also signaled that near-term demand for gold was strong.
Gold heads for positive week on US debt concerns
Spot gold was trading up 3.7% this week, its best performance since early-April, as traders sought haven in the yellow metal amid increasing concerns over high U.S. government debt levels.
This was reflected in a prolonged sell-down in Treasuries this week, which pushed up yields substantially and pressured the dollar.
Concerns over U.S. debt were first sparked by Moody’s downgrading the U.S. sovereign rating.
The progress of a tax cut and spending bill backed by President Donald Trump also factored into concerns over fiscal health. The bill, which narrowly cleared the House of Representatives on Thursday, is expected to add over $3 trillion to national debt in the next decade, according to non-partisan analysts.
Dollar weakens, boosts broader metal prices
The dollar was battered by concerns over high U.S. debt and the Treasury sell-off, which put the greenback on course for a weekly decline.
This trend boosted broader metal prices and other commodities priced in the greenback, putting them on course for weekly advances.
Among other precious metals, silver futures rose 0.4% to $33.345/oz, and were set to add over 3% this week. Platinum futures rose 1.1% to $1,096.80/oz, and were trading up over 10% this week after rallying sharply from weeks of consolidation.
Among industrial metals, copper prices benefited from signs of more stimulus in top importer China.
Benchmark copper futures on the London Metal Exchange rose 0.2% to $9,530.75 a ton, and were up 0.8% this week. U.S. copper futures rose 0.5% to $4.6985 a pound, and were up 2.3% this week.
