- Gold prices are ‘pretty well underpinned’ by Brexit: Cordier
- Silver holdings in ETFs just short of record in October 2014
Gold climbed to the highest in four weeks as uncertainty mounts over whether Britain will exit the European Union and traders price in zero odds the Federal Reserve will raise U.S. interest rates this week.
Polls showed the outcome of the Brexit referendum was too close to call, boosting the metal’s appeal as a haven asset. Fed futures data show no chance the U.S. central bank will raise interest rates Wednesday, down from a 24 percent likelihood at the end of May, after U.S. non-farm payroll data came in weaker than expected.
Gold is up 21 percent in 2016 as a global economic slowdown led by cooling of growth in China, as well as dialed-back expectations that the Fed will raise rates, boosted the metal’s appeal as a store of value.
“The Brexit is really under the microscope right now, and that’s the catalyst that’s pushing gold up to higher levels today,” James Cordier, the founder of Optionsellers.com in Tampa, Florida, said in a telephone interview. “Gold is going to be pretty well underpinned as we prepare for the Brexit because those are uncharted waters. And right now just about everyone is betting there won’t be a move on interest rates in June.”
Gold futures for August delivery rose 0.9 percent to settle at $1,286.90 an ounce at 1:37 p.m. on the Comex in New York, a fourth straight gain and the longest stretch in more than a month. Earlier the price touched $1,290.30, the highest since May 16.
In other precious-metals news:
- Holdings in gold-backed exchange-traded funds added 6.51 metric tons to 1,873.8 tons as of Friday, the highest level since November 2013, data compiled by Bloomberg show. The assets rose for a ninth straight day.
- Silver holdings in ETFs have increased for 10 straight days and are just short of the record 20,182 tons set in October 2014.
- Silver futures for July delivery rose 0.7 percent to $17.443 an ounce on the Comex.
- On the New York Mercantile Exchange, platinum gained, while palladium slipped.