January 10, 2020 / 4:11 PM / 8 days ago

PRECIOUS-Gold firms on renewed U.S.-Iran tensions, eyes fifth weekly gain

 (Adds analyst comments, market details, updates prices)
    * U.S. payrolls weaker than expected in December
    * SPDR Gold holdings fell 0.5% on Thursday
    * Palladium set to register best week since mid-June

    By Eileen Soreng
    Jan 10 (Reuters) - Gold edged higher on Friday, and was on
track to post a weekly gain for fifth straight week, as fresh
sanctions on Iran by the United States stoked uncertainty
supporting demand for the bullion.
    The targets of the sanctions included Iran's manufacturing,
mining and textile sectors as well as senior Iranian officials
who Washington said were involved in the Jan. 8 attack on
military bases housing U.S. troops.                          
    Spot gold        rose 0.4% to $1,557.86 per ounce by 2:12
p.m. EST (1912 GMT) and was up about 0.4% for the week.
     U.S. gold futures        settled up 0.4% at $1,560.1 per
ounce.
    "The main catalyst for gold prices is the dialogue that's
taking place over Iran and weather or not we are going to see an
acceleration of the conflict... The instability over that is
causing all the volatility," said Jeffrey Sica, founder of
Circle Squared Alternative Investments.
    With the sanctions its becoming obvious that there is going
to be even economic consequences, Sica added. 
    Gold, often considered a safe investment during political
and economic turmoil, surged above $1,600 on Wednesday after
Iran launched missile strikes on U.S. forces in retaliation for
the killing of its top commander in a drone attack.             
    However, prices retreated 4% after the two sides softened
their stance.             
    "The pullback that we saw the last couple of days gave
people an opportunity to buy today," said Michael Matousek, head
trader at U.S. Global Investors.
    "There's some resistance at $1,562 but if it trades up
through there, that's going to be a key level to where
short-term traders are going to be involved." 
    Meanwhile, data from the U.S. Labor Department showed job
growth slowed more than expected in December helping prop up the
bullion further.              
    The U.S. dollar also fell from four-week highs against the
safe-haven yen and slid versus the Swiss franc on the
possibility of renewed tensions in the Middle East.       
    Holdings of the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust      , fell for the second straight
session on Thursday.          
    Elsewhere, palladium        was up 0.4% at $2,115.88 per
ounce, having hit a record peak of $2,149.50 in the previous
session on supply constraints. The metal was still on track for
its biggest weekly rise since mid-June, up more than 6% so far.
    Silver        was up 0.9% at $18.06 per ounce. 
    Platinum        gained 1.3% to $978.48 per ounce but was
down 0.2% for the week so far.

 (Reporting by Eileen Soreng in Bengaluru
Editing by Matthew Lewis and Marguerita Choy)
  
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