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Gold steady after Manchester blast; U.S. political turmoil supports
May 23, 2017 / 4:26 AM / 6 months ago

Gold steady after Manchester blast; U.S. political turmoil supports

REUTERS - Gold held steady on Tuesday with investors staying on the sidelines after a suicide bombing attack in the English city of Manchester left at least 22 people dead and more than 50 injured.

Gold bars are stacked in the safe deposit boxes room of the Pro Aurum gold house in Munich March 3, 2014. REUTERS/Michael Dalder/Files

The explosion occurred at the end of a concert by U.S. singer Ariana Grande on Monday.

Prime Minister Theresa May said the incident was being treated as a terrorist attack, making it the deadliest militant assault in Britain since four British Muslims killed 52 people in suicide bombings on London’s transport system in July 2005.

“Right now, precious metals prices are relatively quiet, this despite tragic news coming out of Manchester, England,” said INTL FCStone analyst Edward Meir.

“We suspect that gold will respond more forcefully going into Tuesday’s session as geopolitical tensions start to rise again.”

Spot gold was nearly flat at $1,259.81 per ounce as of 0823 GMT.

U.S. gold futures dipped 0.1 percent to $1,259.70 an ounce.

The metal has been supported by the political tensions in the United States due to the controversies involving President Donald Trump, and the dollar’s weakness against the euro.

“The weaker dollar is helping gold … Chopping off of some long positions has made the market healthier,” said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.

Spot gold advanced by 2.2 percent last week as the furore over Trump’s alleged links to Russia and his firing of former Federal Bureau of Investigation chief James Comey raised concerns about his ability to push through promised fiscal stimulus.

“Headlines out of Washington are likely to provide continued support for the metal,” Sam Laughlin, senior precious metals trader at MKS said in a note.

The euro hovered near a six-month high against the dollar on Tuesday after German Chancellor Angela Merkel said the currency was “too weak”.

Spot gold may gain further to $1,272 per ounce, following its break above a resistance at $1,257, according to Reuters technical analyst Wang Tao.

“Nervousness ahead of Thursday’s OPEC meeting should see traders continue to hedge risk by buying gold on dips over the next few days,” said Jeffrey Halley, a senior market analyst at OANDA.

Among other precious metals, silver was down 0.2 percent at $17.08 an ounce. It hit a three-week peak on Monday, when it rose 1.8 percent in its biggest one-day percentage rise since April 11.

Platinum was down 0.1 percent at $945.05 an ounce but hovered near its highest in more than three weeks touched on Monday.

Palladium dipped 0.4 percent to $767.20 per ounce. It fell to a more than two-month low in intraday trading on Monday but recovered to end the day 1.5 percent higher, its biggest one-day percentage gain since April 20.

Reporting by Vijaykumar Vedala in BENGALURU; Editing by Subhranshu Sahu and Tom Hogue

Our Standards:The Thomson Reuters Trust Principles.
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