Gold Bounces Back After Post-Election Selloff
Front-month gold futures settled up 1.2% at $2,698.40 an ounce. The uptick comes after gold shed 2.7% in the previous session, as traders digested the implications of Donald Trump's victory in the U.S. Presidential election.
Traders had anticipated gold would return to its upward momentum, with risk factors like the incoming administration and war in the Middle East, creating uncertainty and demand for safe haven assets.
"The macro backdrop will likely remain favorable for the precious metal as interest rates decline and foreign reserve diversification continues amid geopolitical tensions," ING says in a note. "Safe haven demand combined with bullish bets from hedge funds - hovering around four-year highs, with gold-backed ETF holdings posting a fifth consecutive month of gains in October - could mean the rally in gold prices is not over just yet.".
Source: marketwatch