As Gold Blows Through $1,300, Will Gold's Safe-haven Rally Stick?
KITCO NEWS - Gold prices were trading at the highest level in almost a year on Tuesday as investors flocked to the safe haven on heightened tensions between North Korea and Japan. Trading solidly above the key psychological level of $1,300 on the news of a North Korea missile launch over Japan's airspace, gold for December delivery rose $9.70, or 0.7%, to $1,325 an ounce - on track for its highest settlement value since last September. While recent news from North Korea saw gold's safe-haven rallies to be short lived, Frank Holmes, chief executive officer for U.S. Global Investors, said this time it's 'different.' He noted that the scenario now includes a change in U.S monetary policy and a hurting U.S. dollar, both positives for the metal. However, Holmes added the caveat is that gold will likely see a pullback before taking off again. 'We are due for a correction,' Holmes said. 'But real yields are shrinking rapidly and as that happens, the dollar falls...I am very bullish gold,' the fund manager added. The SPDR Gold Shares ETF GLD tacked on 0.6%, while those for gold miners, the VanEck Vectors Gold Miners ETF, climbed 0.5%.
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This article is commentary by an independent contributor.
