Geopolitical tensions continue to drive Gold higher
NEW YORK (Scrap Register): Mitsubishi looks for gold to continue to draw some support from geopolitical tensions.
Analysts noted that spot metal hit a three-month high around $1,365 an ounce last week after international condemnation of a suspected chemical-gas attack in Syria.
Bullion, as well as other perceived safe-haven assets such as the Japanese yen and Swiss franc, hit multi-month highs amid rising geopolitical tension between the U.S. and Syria’s key allies -- Russia and Iran.
Just as crude-oil prices have taken strength from the current geopolitical situation, rising to a three-year high on fears of Middle East supply interruption, so too Mitsubishi expects precious metals to remain well supported as traditional safe havens.
Following targeted air strikes by the U.S., U.K. and France, which took place on alleged chemical-weapons sites in Syria over the weekend, gold is likely to begin the new week strongly on geopolitical tensions, though such tensions can quickly be priced out of the situation eases.
Meanwhile, Mitsubishi said silver prices remain in their range from the last two months, although with the possibility that they may break out on further geopolitical concerns.
The most active June gold contract on the COMEX division of the New York Mercantile Exchange settled higher by $2.80 to $1,350.70 an ounce on Monday. It tallied a rise of roughly 0.8% last week, after ending Wednesday at the highest finish since late January.