Gold on Thursday climbed above US$1,300 to the highest level in six weeks after the Federal Reserve scaled back the outlook for interest rate increases, Bloomberg reports.
Bullion for immediate delivery advanced 0.7 percent to US$1,300.66 an ounce before trading at US$1,297.45 by 9:48 a.m. Singapore time, according to Bloomberg generic pricing.
London gold price rose for the fourth straight session and reached the highest level since mid-May on Wednesday.
Safe-haven demand is on the rise as several central banks are holding meetings this week and the possibility of Brexit continues to worry investors.
The sterling-denominated gold price jumped 1.9 percent to 909.83 pounds (US$1,290.18) per ounce, the highest in almost three years.
The yellow metal once rallied to a one-month high of US$1,287 per ounce.
The sterling continued to ease against the dollar on Tuesday and tumbled to a two-month low, as recent surveys show a rising risk of the United Kingdom withdrawing from the European Union.
The sterling dropped to a two-month low of 1.4109 against dollar on Tuesday, and fell to 149.16 against the Japanese yen, the lowest in 34 months.
The UK currency has continued sliding against the dollar over last few days, from a high of 1.4738 on May 26.
Hopefully, it would have some support at the 1.41 level, or it might face further downside to 1.389 as shown by technical charts.
Brexit risk also affected the euro, since it would exert a negative impact on the eurozone economy as well as hamper the consolidation of European companies.
The euro eased to 1.12 against the dollar on Tuesday. It has kept falling since last month and tumbled to a two-month low of 1.1096 last week, just above the 250-day moving average of 1.1097.
It could slip further if it fails to stay above that level, or fall further to 1.1 or 1.08.
The Japanese yen has outperformed among G10 currencies. It soared to a six-week high of 105.6 on Tuesday.
The dollar would see some resistance at 107.2 or the 50-day moving average of 108.75, and 110 remains a key level.
Safe-haven demand continues to dominate the market.
The Aussie dollar eased against the greenback to 0.733 in early trading Tuesday. The Australian currency has to return above the 100-day moving average of 0.739, which could be a sign that it would stage a comeback.
Meanwhile, the New Zealand dollar was also under pressure on Tuesday and weakened to 0.7 against the US dollar.
It has dropped off the peak of 0.7744 in April last year. It might ease further to 0.7 given there is limited upside.
The resistance level is at 0.7158, and if it manages to break that level, it might rise further to 0.72 or 0.732.
This article appeared in the Hong Kong Economic Journal on June 16.
Translation by Julie Zhu with additional reporting
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