AFP, New York :
Gold prices struck near six-year highs on Friday as a weaker dollar and escalating US-Iran tensions fueled a flight to safer investments, while oil futures built on strong gains. The week has been an eventful one for stock markets, crude prices and the dollar – and investors still have a key G20 summit to look forward to amid hopes for progress on the US-China trade war. “Gold has been one of the week’s biggest stories, with the precious metal hitting $1,400 (an ounce) for the first time in almost six years overnight,” said Joshua Mahony, senior market analyst at IG trading group. The gold spike has been caused by the change in sentiment and dollar weakness amid “overnight talk of a canceled US strike on Iranian targets highlighting how close we are from a huge ramp-up in conflict between the two nations,” he said.
US President Donald Trump said he approved the attack then at the last minute scrapped strikes against Iranian targets. Oil prices rose further Friday but the gains were muted compared to a day earlier when crude futures surged about 4.5 percent on rising tensions between the US and the Islamic republic.
Fears of a conflict in the oil-rich Middle East ratcheted up Thursday when Tehran shot down a US spy drone that it said was violating its airspace but which Washington said was over international waters. Recent attacks on tankers close to the Strait, a key shipping lane in the Gulf region through which nearly one-third of the world’s oil is transported, sent oil prices surging late last week.
But it was gold’s turn to take center stage on Friday, with the commodity reaching $1,411.63 an ounce, the highest level since September 2013. “A slowing global economy, imminent US rate cuts and rising geopolitical tensions provide a near perfect storm for gold bugs,” said XTB chief market analyst David Cheetham.
Gold prices struck near six-year highs on Friday as a weaker dollar and escalating US-Iran tensions fueled a flight to safer investments, while oil futures built on strong gains. The week has been an eventful one for stock markets, crude prices and the dollar – and investors still have a key G20 summit to look forward to amid hopes for progress on the US-China trade war. “Gold has been one of the week’s biggest stories, with the precious metal hitting $1,400 (an ounce) for the first time in almost six years overnight,” said Joshua Mahony, senior market analyst at IG trading group. The gold spike has been caused by the change in sentiment and dollar weakness amid “overnight talk of a canceled US strike on Iranian targets highlighting how close we are from a huge ramp-up in conflict between the two nations,” he said.
US President Donald Trump said he approved the attack then at the last minute scrapped strikes against Iranian targets. Oil prices rose further Friday but the gains were muted compared to a day earlier when crude futures surged about 4.5 percent on rising tensions between the US and the Islamic republic.
Fears of a conflict in the oil-rich Middle East ratcheted up Thursday when Tehran shot down a US spy drone that it said was violating its airspace but which Washington said was over international waters. Recent attacks on tankers close to the Strait, a key shipping lane in the Gulf region through which nearly one-third of the world’s oil is transported, sent oil prices surging late last week.
But it was gold’s turn to take center stage on Friday, with the commodity reaching $1,411.63 an ounce, the highest level since September 2013. “A slowing global economy, imminent US rate cuts and rising geopolitical tensions provide a near perfect storm for gold bugs,” said XTB chief market analyst David Cheetham.
