Gold breaks above $1,300 an ounce amid US poll jitters

The nervousness over the US presidential elections has continued to suppress investors’ appetite for risk and it has been announced on Thursday that Gold has continued to break the $1,300 level.

As at now, 24 karat gold is retailed at Dh158.25 per gram. This figure is up by Dh3.75 since October 31.

The strengthening of gold was as a result of the results of the US polls and speculations finds it that before the end of the year the Federal Reserve could tighten monetary policy.

“Gold was back in demand for the first time in four weeks. Buyers returned as the yellow metal continued to build a base at $1,250 an ounce,” said Ole Hansen of Saxo Bank.

If Donald Trump wins the elections, the US dollar is expected to be affected and this will in turn boost the price of gold.

“Gold prices have increased due to increased concerns over US elections outcome and weak US dollar. Forecasting commodity prices in today’s uncertain environment is almost impossible, [but] I expect gold price to remain very volatile till the election results” said Karim Merchant (group CEO and managing director of Pure Gold Jewellers).

As a result of the celebration of Diwali, gold demand from Indian market surged. Local retailers were reporting between 10% to 20% increase in jewellery sales.

“It provided a much-needed break for the [retail sector] that has faced a long challenging year,” he added. “On average, I would say the industry experienced between 10 per cent and 20 per cent increase in sales when compared to last year’s Dhanteras or at most, the same as last year, indicating an uplift in consumer sentiment” Merchant.

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