In the wake of a rapidly withering Sino-US relationships, the precious gold futures’ prices had gained over 1 per cent on Wednesday to breach its highest level in nine years, while other precious metals such as silver and platinum had also clocked solid gains over prospects of a recovery in industrial demands.
In factuality, Wednesday’s gains of the precious metals were largely goaded by a flight-to-safety move from the investors, as an US order to shut down Chinese consulate in Houston over allegations of espionage had stoked demands for safe-haven assets.
Geopolitical tension accelerates spot gold prices higher
Concomitantly, while the United States had ordered to close the Chinese consulate in Houston, people familiar with the matter said later on the day that Beijing had also been mulling an option to shut down the US consulate in Wuhan as part of an inevitable retaliation, which in effect had heightened up demands of the safe-haven commodities further.
Citing statistics, on Wednesday’s commodity market closure, spot gold had wrapped up the day 1.3 per cent higher to $1,865.61 an ounce after hitting an intra-session high of $1,870.01 per ounce, its highest level since the September of 2011, while the spot gold prices had hit its all-time closing highs.
Besides the US gold futures’ prices ended up the day 1.2 per cent higher to $1,865.10 an ounce. Among other precious metals, silver futures’ prices surged by 6.4 per cent to $22.68 per ounce after hitting a session high of $23.03, its highest level since October 2013, while platinum futures gained 2.6 per cent to wrap up the day at $904.97 an ounce.
Meanwhile, addressing to the latest round of escalation in the Sino-US trade frontiers, a senior market analyst at OANDA, Edward Moya said, “Gold is accelerating higher and that’s been mainly on the geopolitical tensions with China.
There seems to be no end in sight for this escalation ... and it’s going to damage sentiment as the world’s largest countries continue to bicker”.