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Gold adjusts as North Korea tensions ease slightly

Jim Mattis addressing a Nato conference

The gold price has taken a dip since yesterday, making a small downturn to $1,274.52 this morning. As tensions between North Korea and the US seemed to ease, gold for December delivery was also down 0.3% to $1,290.40.

North Korean state media reported Kim Jong-Un had reviewed a plan to send missiles towards the US territory of Guam but opted to hold off and watch what “the foolish Yankees” would do first.

The gold downturn marks the first loss in four sessions for the yellow metal, which has enjoyed a strong run of late. However, political pressures, both geopolitical and domestic following the riots in Charlottesville, continue to put upward pressure on the price.

“If a missile is fired by North Korea towards Guam then the whole set of global financial markets changes. Gold will certainly rise on war fears then,” Julian Phillips of Gold Forecaster told MarketWatch. The dramas of last week, “could easily change back to heightened fears in a heartbeat,” he added.

US secretary of defence, Jim Mattis (pictured above), has stated diplomacy remains front and centre of efforts to dispel the ongoing situation but also made clear the US military would look to intercept any North Korean missiles fired towards Guam. Naeem Aslam, chief market analyst at Think Markets told Reuters he believed these comments had upped the ante, “so the latest pullback in the gold price doesn’t mean that the bulls are out of energy”. Aslam also pointed to the lack of supply for Asian markets that is likely to provide further upward price pressure.

Other commentators were less bullish: “Unless tensions between the United States and North Korea escalate into a military conflict, there should be little upside to gold prices from current levels. Once the tensions move out of the focus of financial markets, e.g. as with the Ukraine crisis, gold should move lower,” said Carsten Menke, a commodities research analyst at Julius Baer. “It is almost impossible to assess the likelihood of such an escalation into a military conflict,” added Menke.

Other metals have also taken a dip as investors reassess “safe-haven” assets. Palladium dropped almost 0.2% to $893.50, while platinum lost 0.6%, hitting $959.6 and silver lost 1% to finish on $16.84 per ounce.

Photo: Jim Mattis addressing a Nato conference earlier this year. Credit: DoD, Air Force Staff Sgt. Jette Carr

 

 

Link to this article: : http://www.goldmadesimplenews.com/gold/gold-adjusts-as-north-korea-tensions-ease-slightly-13348/

Posted by on Aug 15 2017. Filed under Gold News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

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