Gold Rebounds on Safe Haven Flows

Gold rebounded on Monday from last week’s six-year low as the attacks in Paris prompted a bout of global risk aversion.

Spot gold rose as much as 1.4 percent to a 10-day high of $1,097.90 an ounce, and was last up 0.1 percent at $1,084.38, with U.S. gold futures were up 0.3 percent an ounce at $1,084.

In the first 10 minutes of Monday trade, nearly 3,000 lots changed hands, almost 10 times the 300-lot average for the opening 10 minutes over the past two months, Reuters’ calculations showed.

“Gold opened higher early this morning on the back of what happened over the weekend on perceived geopolitical risk, but it seems to be already short-lived because the bigger macroeconomic issues are the dollar’s strength and the (expected) U.S. rate hike,” Citi strategist David Wilson said.

“The metal is struggling to make it back above $1,100,” Saxo Bank senior manager Ole Hansen said.

Before Monday’s gains, gold had fallen for 12 sessions out of 13 on increasing bets that the Federal Reserve would raise U.S. interest rates next month, which would increase the opportunity cost of holding the non-yielding asset. It hit a near-six-year low of $1,074.26 on Thursday.

via CNBC

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