Gold Prices Surge to Reach 5 Month High
On Wednesday, April 12, 2017, the spot price of gold found itself inching up 0.09 percent to $1,275.15 per ounce, the highest it’s been since November 10, 2016, which was at $1,279.80. With most recent developments in the Korean peninsula and the Middle East, investors have been seeking the safe-haven asset, gold.
On Tuesday, North Korea’s Kim Jong-un warned the United States of a nuclear attack at any sign of American aggression, as a U.S. Navy strike group, which Trump called an “armada”, steamed towards the western Pacific. This threat helped move gold to close above the 200-day moving average for the first time this year, after struggling to do so over the past few weeks.
The recent US strikes on Syria has added to investor’s aversion. This attack was prompted by the use of a deadly chemical agent against Syrian civilians, which killed at least 70 people — 10 children among the dead. According to a White House report, U.S. intelligence indicates that the chemical agent in the attack was delivered by a Syrian Su-22 aircraft which took off from the Shayrat airfield. Bashar al-Assad, Syrian’s president has denied that his military has used chemical weapons. President Donald Trump’s administration has gone forward and accused Russia of trying to shield Syria’s government from blame for a deadly gas attack. Speaking of the event, Vladimir Putin said today that trust had eroded between the United States and Russia, and Moscow has offered a hostile reception to U.S. Secretary of State Rex Tillerson as they face-off over Syria.
There is much left unknown as heightened tensions effect the outlook of gold. Will gold prices continue to surge as risk aversion sweeps the financial markets or will this geopolitical impact fade?
