Gold Prices Rise Slightly on Global Geopolitical Turmoil
Gold prices rose slightly in Asian trade on Monday (12/9) as geopolitical turmoil in Syria and South Korea helped spur demand for safe-haven assets, although a strong dollar capped most of the gains.
The yellow metal has had a mixed performance in recent weeks, as rising geopolitical tensions were offset by heightened uncertainty over U.S. interest rates, which has left traders largely favoring the dollar and government bonds.
Spot gold rose 0.2% to $2,638.77 an ounce, while February gold futures were steady at $2,660.41 an ounce by 11:17 p.m. ET (04:17 GMT). Turmoil in Syria, South Korea spurs gold demand
Buying in the yellow metal was largely driven by rising demand for safe-haven assets, after rebel forces took over the Syrian capital, Damascus, and ousted President Bashar al-Assad, who fled to Russia.
Markets are waiting to see what happens after a regime change following a protracted civil war. Rebel forces are partly backed by Turkey and have ties to a Sunni Muslim sect that puts them at odds with Iran.
Other reports say Israel has also entered Syrian territory. In South Korea, a leadership crisis deepened over the weekend when prosecutors named President Yoon Suk Yeol under criminal investigation over a failed attempt to impose martial law last week.
Yoon survived an impeachment vote over the weekend. But his own party leader has said the president will be sidelined and eventually forced to resign.
Two geopolitical flashpoints helped spur some safe-haven demand for gold.
However, gains in the yellow metal were capped by the resilience of the dollar, which strengthened ahead of key inflation data due this week.
Markets largely maintained bets that the Federal Reserve will cut interest rates by 25 basis points next week. However, the central bank’s longer-term outlook on interest rates has turned uncertain, with high inflation and economic resilience likely to trigger slower easing in 2025.
Other precious metals were mostly lower on Monday. Platinum futures were steady at $935.75 an ounce, while silver futures fell 0.5% to $31,442 an ounce.
China’s consumer inflation shrank more than expected in November, while producer inflation shrank for a 25th straight month, amid limited signs of improvement in the country’s economy, despite recent stimulus measures from Beijing.
Source: Investing.com
