Gold Higher After Brexit Triggered

March 29, 2017 Share Print 0

Gold edged up on Wednesday, as uncertainty about Brexit talks, French elections and U.S. President Donald Trump’s economic policies boosted safe-haven buying and offset a firmer dollar.

Spot gold was up 0.1 percent at $1,252.11 per ounce at 1505 GMT. U.S. gold futures slipped 0.3 percent to $1,251.90.

“There are a lot of uncertainties regarding the Trump reflation trade after the failure last week to overhaul Obamacare, and uncertainty in Europe with French elections coming up and the official start today of Brexit negotiations,” said Carsten Fritsch, analyst at Commerzbank in Frankfurt.

“The general picture is still positive (for gold) with dips seen as buying opportunities,” he said.

Prime Minister Theresa May filed formal Brexit divorce papers on Wednesday, triggering years of negotiations that will test the cohesion of the European Union.

A firmer dollar capped gains in gold, as it hit a fresh eight-day high after Chicago Fed President Charles Evans said he supported one or two more U.S. rate hikes this year. “A resurgent U.S. dollar, along with higher U.S. yields and equities has taken the momentum out of the gold rally for now,” said Jeffrey Halley, senior market analyst at OANDA.

via Kitco

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.