Precious-safe-haven gold rises on weak data, simmering uncertainty
By Reuters
Gold rose one per cent on Wednesday, supported by a softer dollar and weak US data, as investors grappled with mounting economic and political uncertainty.
Spot gold climbed 0.8 per cent to US$3,378.22 an ounce by 02:02 pm ET (1802 GMT), after rising as much as 1 per cent earlier. US gold futures settled 0.7 per cent higher at $3,399.20.
The US dollar index fell 0.5 per cent, making gold cheaper for buyers holding other currencies, while benchmark US 10-year Treasury yields edged lower.
"The US services sector - two-thirds of the economy - contracting for the first time in a year has goosed gold a percent higher after bullion had shrugged off a weak though historically volatile ADP employment report," said Tai Wong, an independent metals trader.
"A close back above $3,400 will prime a run for new all-time highs."
The Institute for Supply Management said its non-manufacturing purchasing managers index dropped to 49.9 last month, the lowest reading since June 2024, while ADP data showed US private employers added the fewest workers in over two years.
"There is considerable geopolitical uncertainty with Russia-Ukraine, Iran, Syria and China driving people to buy gold... and although traders may not expect gold to rise as quickly, there is still plenty of upside," said Daniel Pavilonis, senior market strategist at RJO Futures.
US President Donald Trump said his Chinese counterpart Xi Jinping was tough and "extremely hard to make a deal with", just days after accusing Beijing of violating an agreement to roll back tariffs.
In addition, Washington doubled tariffs on steel and aluminum imports and urged trading partners to submit their "best offers" to avoid more import levies.
All eyes are on Friday's US payrolls report for clues on the Federal Reserve's next move.
Gold, a safe-haven asset during times of political and economic uncertainty, tends to thrive in a low-interest-rate environment.
Spot silver was down 0.1 per cent at US$34.45, platinum rose 1.5 per cent to US$1,089.99, while palladium lost 1 per cent to US$1,000.55.
Source : precious-safe-haven-gold-rises-weak-data-simmering-uncertainty
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