الثلاثاء , 22 يونيو 2021
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الرئيسية / سياسة / [:en]Gold gains in Asia as Trump’s firing of Comey sparks policy concerns[:]
[:en]Gold gains in Asia as Trump’s firing of Comey sparks policy concerns[:]

[:en]Gold gains in Asia as Trump’s firing of Comey sparks policy concerns[:]

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[:en]

Gold gained in Asia on Wednesday as markets reacted to a decision by President Donald Trump to dramatically fire FBI Director James Comey, fearing that the resulting political blowback could further derail efforts at tax cuts and other economic policy aims.

Gold for June delivery on the Comex division of the New York Mercantile Exchange rose 0.48% to $1,222.02 a troy ounce. Copper futures on the Comex gained 0.20% to $2.501 a pound.

Elsewhere, China reported consumer prices for April rose 1.2%, more than the 1.1% gain seen year-on-year and producer prices gained 6.4%, less than the expected 6.9% rise.

Overnight, gold prices traded lower on Tuesday, as investors continued to ditch safe-haven assets, after Emmanuel Macron’s victory in the French election eased uncertainty while a surge in rate hike expectations weighed on upside momentum.

Gold futures fell to an eight-week low, as investor sentiment shifted towards riskier assets amid a slump in the so-called ‘fear index’, The VIX volatility index, to a 11-year low.

As the uncertainty over the French election came to end on Sunday, following Emmanuel Macron’s victory, investors have turned attention to U.S. monetary policy amid a surge in June rate hike expectations after hawkish comments from Federal Reserve officials, which prompted a rally in both U.S. Treasury yields and the dollar.

Kansas City Fed President Esther George said on Tuesday, that the U.S. central bank should keep gradually raising short-term interest rates despite the recent slowdown in GDP and car sales.

Dollar-denominated assets such as gold are sensitive to moves in the dollar – A rise in the dollar makes gold more expensive for holders of foreign currency and thus, reduces demand.

U.S. Treasury yields continued to climb – the U.S. 10-Year hit a five-week high of 2.409, up 1.37%. Gold is sensitive to moves in higher bond yields, which lift the opportunity cost of holding non-yielding assets such as bullion.

According to investing.com’s Fed rate monitor tool, 80% of traders expect the Federal Reserve to hike interest rates in June, compared to 63% in the previous week.

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