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PRECIOUS-Gold near 3-mth highs on political, economic uncertainty
February 8, 2017 / 3:37 AM / 9 months ago

PRECIOUS-Gold near 3-mth highs on political, economic uncertainty

    * Political, economic worries boost safe-haven demand for
bullion
    * Spot gold hit 3-mth high of $1,235.78 in previous session
    * SPDR Gold holdings up for fifth straight session

 (Adds comments, updates prices)
    By Sethuraman N R
    Feb 8 (Reuters) - Gold on Wednesday held near three-month
highs hit the session before, buoyed as political and economic
uncertainty in the United States and Europe stoked safe-haven
demand. 
    Spot gold        was largely flat at $1,233.06 per ounce by
0616 GMT. On Tuesday, the metal touched its highest since Nov.
11 at $1,235.78.
    U.S. gold futures         were little changed at $1,236.30
an ounce.
    "The biggest momentum behind gold is the fact that the U.S.
Federal Reserve did not raise rates in the recent meeting, some
uncertainties brought by U.S. President Donald Trump's policies
and a weaker dollar," said Jiang Shu, chief analyst at Shandong
Gold Group.
    "Gold prices will continue to rise until mid-February on
uncertainties in the U.S. and Europe. But, once January CPI data
is released, it will give an idea about the possibility of a
rate hike in March," Shu added.
    Controversy over Trump's temporary travel ban on people from
seven Muslim-majority countries has recently boosted appetite
for bullion as a safe-haven asset, while political uncertainty
in Europe amid upcoming elections has buoyed the dollar.
    "Given the absence of significant data this week, the
market's attention may be squarely on politics," HSBC analysts
said in a note.
    "It is likely that at least some gold buying is the result
of uncertainty over U.S. policy, but also investor reaction to
the possibility that the far-right, eurosceptic candidate in the
French presidential election this year, Marine Le Pen, is
gaining momentum in the polls." 
    Investors are concerned that the far right could win
France's presidential vote and take it out of the European
Union.             
    Holdings of SPDR Gold Trust      , the world's largest
gold-backed exchange-traded fund, climbed 1.01 percent to 826.95
tonnes on Tuesday from Monday. Holdings rose for a fifth
straight session.          
    The rise in holdings, along with recent data from U.S.
Commodity Futures Trading Commission (CFTC), show an increase in
long positions for managed money and a decrease in short
holders, MKS PAMP Group trader Alex Thorndike said.
    A bullish target at $1,249 per ounce has been temporarily
aborted for spot gold and will only be resumed when the metal
breaks above resistance at $1,237, according to Reuters
technical analyst Wang Tao.             
    Spot silver        was mostly flat at $17.68, after marking
its highest since Nov. 11 at $17.79 in the previous session.
    Platinum        rose 0.7 percent to $1,008.40, after
touching its highest since Nov. 9 at $1,015.20 the session
before.
    Palladium        fell 0.2 percent to $759.

 (Reporting by Nallur Sethuraman in Bengaluru; Editing by Joseph
Radford and Amrutha Gayathri)
  

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