Gold Gains In Asia As North Korea Tensions Heighten Risk

Investing.com – Gold prices gained in Asia on Tuesday with risk heightened as President Donald Trump declared North Korea a state sponsor of terrorism, using more stick in dealings with Pyongyang even as contacts are said to be underway to lead to talks.

for December delivery on the Comex division of the New York Mercantile Exchange rose 0.36% to $1,279.92 a troy ounce.

Overnight, gold prices fell on Monday as a slump in the euro amid rising political uncertainty in Germany pushed the dollar to a nearly one-week high dampening demand for the precious metal.

Chancellor Angela Merkel said on Monday that she would prefer new elections rather than lead a minority government after talks to form the country’s next government collapsed overnight.

That sparked concerns over the future leadership position of chancellor Merkel, pressuring the euro to lows, while supporting an uptick in the dollar to trade higher against a basket of global currencies.

The , which measures the greenback’s strength against Also adding to gold weakness was the prospect of higher interest rates as the Federal Reserve’s December 12-13 meeting draws closer amid strong expectations the central bank will raise rates.

According to investing.com’s fed rate monitor tool 100% traders expect the Federal Reserve to raise rates.

Gold is sensitive to moves higher in both bond yields and the U.S. dollar – A stronger dollar makes gold more expensive for holders of foreign currency while a rise in U.S. rates, lift the opportunity cost of holding non-yielding assets such as bullion.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.