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Gold Prices Advance on Trump Impeachment

Gold prices advanced on Thursday. This occurred due to political uncertainty surfacing in Washington. The US House of Representatives voted to impeach President Donald Trump.

US gold futures and spot gold both posted a 0.1% gain to $1,480.55 and $1,476.64 per ounce respectively, before easing to trade at $1,479.25 and $1,473.90.

Other precious metals, including the palladium, was last up 0.3% to $1,903.50 per ounce. On the other hand, silver dropped 0.5% to $16.962 per ounce.

Platinum futures were also down by 0.5% to $930.35 per ounce.

Elsewhere, the energy commodities market traded steady. Oil prices staying close to three-month highs after official data showed a drop in US crude stockpiles.

Global benchmark Brent crude futures fell 0.1% to $66.25 per barrel. While West Texas Intermediate (WTI) crude futures shed 0.05% to $60.88 per barrel.

Weekly data from the Energy Information Administration (EIA) showed on Wednesday that US crude inventories declined by 1.1 million barrels in the week to December 13. But, contrarily, gasoline and distillate supplies grew.

Trump Impeachment Offsets Headwinds for Gold Prices

Cautious sentiment within the commodities market helped lift gold prices. However, there is anticipation that the US president will survive a trial in the GOP-led Senate starting in January.

Analyst Daniel Hynes, stated the impeachment is resulting in a slight increase of the uncertainties. Moreover, the yellow metal is inching higher on the back of that.

The House voted almost entirely along the party’s line for two articles of impeachment to remove Trump from office. They included the abuse of power and obstruction of Congress.

The news, according to Hynes, is also curbing the impact of strong stock markets, the US-China trade deal, and improved economic data.

The strength of the precious yellow metal was kept in check on Thursday by robust performance in the US manufacturing sector.

The US is due on Friday to release data on existing home sales and initial jobless claims for the month of November.

The Federal Reserve brought 2019’s rate cuts to a close last month, following three consecutive reductions of a quarter percentage point.

Fed Chairman Jerome Powell has since stated that he would like to see better inflation growth first before the central bank executes another rate cut.

The Fed Chair seeks a persistent and significant rise in inflation before they decide on a rate hike. This will eventually limit real rates further and provide a tailwind for gold prices in 2020, a Canadian investment bank said.

This lends strength to the view that the gold’s rally is young. Additionally, that it is prone to continue through the New Year, the bank added.



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