The gold is looking to extend its strong surge despite significant political events that are expected these coming days. Investors are also bracing themselves as the UK election creeps closer and closer, while potential uproar from James Comey’s testimony. The larger fear coming from the snowballing turmoil in the Middle East is also one of the key factors on why gold rallies up.
One more key event on the major surge of gold can be traced on the backlashes that President Donald Trump experienced when he again took the headlines as he pulled the US on the recent Paris climate agreement.
Local and International Feud Pushes Gold
On the other hand, the Europeans have been experiencing heavy ruckus just before the election dawns; while countries such as Saudi Arabia, the United Arab Emirates, Egypt, Yemen, and Bahrain have withdrawn diplomatic and commercial ties with Qatar. The company is rumored on sponsoring small gull state terrorism.
Both local and international political disturbance had propelled the gold’s price by about 1.06% to $1296.30 per ounce on the Tuesday Market. The weaker dollar also provided a good bump on the commodity’s price; the greenback dips on weaker-than-expected jobs reports. Both the dollar and gold are pulling the equilibrium so when the other goes up, the other is bound to dive face first into the market.
Gold’s Future Rises
The likes of Barrick Gold Corporation’s stock bolstered on the upbeat performances in the past days, it was up by 3.83% yesterday; while Newmont Mining Corporation also saw some increase by 2.32%, Canadian gold mining companies McEwen Mining Inc. and Klondex Mines Ltd. were both respectively increased by 4.41% and 3.25%. One of the top gainers was DRDGOLD Limited which saw a sizable increase of 7.06%.
Gold ETFs such as SPDR Gold, iShares Gold Trust, and VanEck Vectors Gold Miners saw a sizable increase in their stocks; both GLD and IAU’s share were both up by 1%, while GDX manages to outperform the competition with a 3.21% increase.
According to a recent survey, gold is up by a total 12% in 2017 and analysts are expecting more of the commodity this year. According to Jeffrey Halley of Oanda Corp that is based in Singapore “The two main drivers of gold are the value of the U.S. dollar and uncertainty,” and that “We have both in abundance at the moment. The double whammy has seen traders pile into gold and, given the power of the rally this week, I can’t see any other outcome than a test of $1,300 sooner rather than later.”
Gold’s Potential Downfall
The only thing that can seize the gold’s tremendous run is the most anticipated hike on the interest hike from the Federal Reserve. According to Asian commodities manager at Philip Futures Pte, Avtar Sandu “The amount of uncertainty in the world has increased,” and “Despite the rate hike expected in June, the markets are pretty strong. Going forward, it’s a matter of how many hikes there are going to be and when. We just expect one more, maybe in December.”
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