Gold Rallies to Three-Week High After FBI Reopens Clinton Probeby and
Bullion’s a ‘cheap bet’ for weekend surprise, BMO’s Wong says
Probe comes as Clinton has an average 4-point lead in polls
Gold futures rallied to a three-week high after the U.S. Federal Bureau of Investigation said it’s reopening an inquiry into Hillary Clinton’s use of private e-mail while secretary of state, boosting demand for the metal as a haven.
The politically explosive development comes less than two weeks before the presidential election. Clinton held an average four-point lead over Republican Donald J. Trump in polls that include independent candidates as of Friday, according to Real Clear Politics. Equities erased gains, and the dollar fell after the announcement.
Bullion futures for December delivery gained as much as 1.3 percent to $1,285.40 an ounce, the highest since Oct. 4, in electronic trading after the settlement. Before the FBI letter to Congress came out, futures had been stuck in a narrow trading range, with price swings measured by the 60-day historical volatility near the lowest in almost two years.
“It’s a bored market that found a driver,” said Tai Wong, the director of commodity products trading at BMO Capital Markets in New York. “One might consider this a cheap bet for a weekend surprise.”
The December contract settled at $1,276.80, or 0.6 percent higher than yesterday’s close, at 1:42 p.m. on the Comex in New York.
Bullion’s 25 percent first-half surge has fizzled on mounting expectation that the Federal Reserve will raise interest rates soon, reducing the appeal of owning non-yielding assets.
U.S. gross domestic product picked up in the third quarter after an uninspiring first half of the year as a build in inventories and a soybean-related jump in exports helped cushion softer household spending. While the U.S. posted its fastest growth in two years, the data failed to resolve the debate about whether the world’s largest economy is emerging from an extended funk.
In other precious metals:
- Silver futures gained on the Comex while platinum and palladium futures rose on the New York Mercantile Exchange.