Gold surges as investors tick off hours to Brexit speech

Singapore - The new year has been kind to gold. Prices have advanced every day apart from a single session this month on a reappraisal of political and economic risks as the UK gets to grips with the Brexit process and investors await Donald Trump’s inauguration.

Bullion for immediate delivery rose as much as 0.9% to $1 212.99 an ounce, the highest level since November 23, and traded at $1 211.32/oz at 08:59, according to Bloomberg generic pricing. The metal is up for a seventh straight day.

Gold has rallied 5.6% this year as investors moved toward safer assets amid concern over Trump’s policies and the UK’s impending break from the European Union.

Prime Minister Theresa May is due to deliver a major speech on Tuesday in which she may say that the UK is likely to pull out of the single market for goods and services and seek a completely new trading relationship with the bloc. Trump will be sworn in as US president on Friday.

“There is a lot of uncertainty in the market,” Brian Lan, managing director of Singapore-based GoldSilver Central said by phone. “Gold is a good safe haven, especially in these types of periods of uncertainty, especially political uncertainty.”

Bullion’s advance has been buttressed by a pause in the dollar’s rally, as well as signs of increased demand.

The Bloomberg Dollar Spot Index, which tracks the greenback against 10 peers, fell 0.6% on Tuesday, and has lost about 1.1% since the end of 2016. Holdings in exchange-traded funds backed rose 2.5 metric tons on Friday, the biggest jump since November 9.

Mining companies have traded higher in 2017 as bullion advanced. In Australia, Newcrest Mining, the country’s top producer, rose 1.7% on Tuesday to the highest since November 11, while Evolution Mining added 3.2%.

In China, bullion of 99.99% purity added 0.6% to 272.20 yuan a gram on the Shanghai Gold Exchange. On the Shanghai Futures Exchange, gold for June delivery advanced 0.6% to 274.50 yuan a gram, while silver slid 0.1% to 4 140 yuan a kilogram. Spot silver climbed 0.7%, palladium rose 0.1% and platinum gained 0.5%.

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