Gold climbs on renewed North Korea concerns

09/10/2017 11:48 AST

The spot gold price climbed during Asian morning trading on Monday October 9 as news emerged that North Korea may be about to test a new long-range missile capable of reaching the west coast of the USA, stoking haven demand for the yellow metal.

The spot gold price was recently quoted at $1282.85-1283.25 per oz, up by $6.40 as of 06:30 BST today. Trade has ranged from $1,275.35-1,285.50 so far today.

Renewed tension in the Korean peninsula saw gold prices climb this morning, as investors opt for safer assets.

The heightened geopolitical risk has also weighed on the dollar this morning, but expectations of a US rates rise in December continue to provide support for the currency. The dollar index was down 0.01% to 93.76 as of 6:47 BST.

“Down but not out best describes golds price action on Friday. Having sold off to a low at $1,260.00, gold staged a remarkable $18 comeback to close at 1278.00 as news emerged that North Korea may be about to test a new missile capable of reaching the USA. The rally has continued this morning with gold moving to $1,284.50 as China returns from holiday. Iranian sabre rattling, Trump remarks on North Korea and further details of the proposed missile test have injected a geopolitical risk premium back into the yellow metal,” Jeffrey Halley, senior market analyst at Oanda said.

“Admittedly gold was approaching a technically oversold condition in the short term anyway. The key now will be if the rally can maintain its longevity once the dust settles and in the face of higher US yields and a stronger US dollar,” Halley added.

Bullion Desk