Gold prices rose in Asian trade on Thursday, extending recent gains as demand for safe havens was buoyed by persistent concerns over high U.S. debt levels and the passage of a tax cut bill.
Bullion was buoyed by recent reports of Israel planning an attack on Iran, although the announcement of more nuclear talks between Tehran and Washington helped quell fears of an immediate attack.
But gold retained most of its gains from earlier this week, as reports said Israel was standing ready to attack Iran if talks with the United States broke down.
Spot gold rose 0.7% to $3,338.04 an ounce, while gold futures for June rose 0.8% to $3,339.20/oz by 01:27 ET (05:27 GMT).
Gold buoyed by US debt concerns Gold was largely underpinned this week by heightened concerns over stretched U.S. debt levels, especially after Moody’s cited the matter as a key motivator for its recent downgrade of the U.S. credit rating.
Traders were seen dumping U.S. Treasuries and the dollar in favor of gold and other safe havens, with Treasury yields rising sharply this week. The U.S. Treasury saw soft demand for a $16 billion sale of 20-year bonds on Wednesday.
Focus was on a House of Representatives floor vote on a sweeping tax-cut and spending bill, which could occur this week after a Republican-controlled house committee approved the bill for vote.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. Analysts argue that the proposed tax cuts and increased border and defense spending could further increase the U.S.’ debt pile, ramping up fiscal risks for the country. This comes against the backdrop of continued uncertainty over the economic impact of President Donald Trump’s trade policies, which was a key driver of gold’s gains this year.
Other precious metals rose on a softer dollar. Platinum futures rose 0.4% to $1,082.20 an ounce, while silver futures rose 0.7% to $33.873/oz.
Copper upbeat with focus on China stimulus Among industrial metals, copper prices advanced on Thursday, benefiting from a softer dollar and as traders continued to cheer signs of more stimulus in top importer China.
Benchmark copper futures on the London Metal Exchange rose 0.2% to $9,545.50 a ton, while U.S. copper futures rose 1.3% to $4.7175 a pound.
Copper was sitting on strong gains this week after China cut its benchmark loan prime rate to further loosen monetary policy and support the economy.
This week’s cut increased optimism that China will release more measures to support growth, which could in turn buoy the country’s appetite for copper.
Trade dialogue between China and the U.S. also remained in focus, amid some signs of strain after a truce last week.
