SINGAPORE (BLOOMBERG) - Gold futures rallied above US$1,500 an ounce on Wednesday (Aug 7) on sustained demand for the traditional haven as the US-China trade war festers, global growth slows and central banks around the world ease monetary policy.
The precious metal rose as much as 1.1 per cent to US$1,500.40 an ounce on the Comex, the highest level since 2013. The move extends this year's advance to 17 per cent, with gains underpinned by investor inflows into exchange-traded funds.
Gold has been one of the chief beneficiaries of the turmoil in global financial markets as Washington and Beijing spar over trade. In recent days, the Trump administration threatened fresh tariffs against Chinese goods, the yuan was allowed to sink, and the US branded China as a currency manipulator. The stand-off has boosted the odds of more easing from the Federal Reserve.
"Investor demand for safe-haven assets remained strong, with gold prices pushing higher," Australia & New Zealand Banking Group Ltd said in a note.
Futures traded at US$1,499.10 an ounce at 9.45am in Singapore, gaining for a fourth straight day. Silver also climbed, with spot prices jumping more than 2 per cent.
In addition to the challenges thrown up by the trade war, there are other risks. In Europe, investors are tracking the chances of a no-deal Brexit later this year, while there are tensions in the Middle East between Iran and the US.