Gold prices are surging on Tuesday after US
February gold futures climbed $16.20, or 1.35%, to $1,212.40 per ounce at 16:40 GMT on Tuesday. Gold had pared some of its gains earlier in the trading session when it topped $1,215. Gold prices have not traded at these levels since the middle of November.
Silver is also joining in the rally. February silver futures rose $0.36, or 2.15%, to $17.12 an ounce. This comes as silver posted a 2% weekly gain last week.
Speaking in an interview with The Wall Street Journal, Trump explained that the US dollar is “too strong,” and its strength against the Chinese yuan renminbi is “killing us.” He added that the strength of the greenback is preventing US companies from competing with Chinese companies. Trump also predicted that more countries would leave the European Union and referred to NATO as “obsolete.” These remarks led to the US dollar, which recently hit a 14-year high, tumbling.
Gold is also benefiting from the various unknowns pertaining to the incoming Trump administration’s plans for the US economy. Ahead of the January 20 inauguration, the Trump campaign has called for tax cuts, an aggressive infrastructure spending project, and further protectionist policies, like a border tax.
Meanwhile, British Prime Minister Theresa May delivered a speech on Tuesday in which she further cemented the nation’s plan to leave the EU. She explained that the UK does not plan to be a partial member of the EU and will make a definitive exit from the trading bloc.
No deal for Britain is better than a bad deal for Britain.
In addition to the investor fears over Brexit and Trump, there are still concerns regarding the upcoming elections in France, Germany, and The Netherlands. With the
When international affairs seem bumpy, traders dive into safe haven assets like gold and silver.
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