Investors will most likely tend to shift their assets to safe-haven forms other than the US dollar (Credit : e-mas)

Dollar is no longer tempting, investors are more interested in gold

Uncertainty of trade wars and protests in Hong Kong led to increased metal prices. This triggered the strengthening of gold prices.

According to Director of GoldCore, Mark O'Byrne as quoted from Marketwatch page, on Thursday (06/13/2019), Concerns about a trade war between the United States (US) and China and its impact on the global economy pushed gold prices higher. Tensions in trade wars may have been anticipated, but escalation and settlement of trade wars are still closely watched by market players and haven’t reflected prices.

Gold price for the August delivery contract on the New York Commodity Exchange (COMEX) was trading on Wednesday (05/13/2019) at 10:30 WIB, up 0.13% to the position of US $ 1,338.5 / troy ounce. In addition, gold price in the spot market rose 0.23% to US $ 1,336.26 / troy ounce at the same time. Yesterday, COMEX gold and spot price also rose by 0.42% and 0.49% respectively.

US dollar lower index and yields on weaker securities also make gold more attractive. Gold also gained positive sentiment after the yield of US securities fell sharply last week. This is as investors increase their bets against US central bank which will reduce interest rates in 2019. Low yields will certainly give positive results for the gold price.

Other sentiments influenced the movement of the gold price, investors observed protests in Hong Kong and tensions in Middle East. AP reported, that in Middle East, Iranian alliance has launched an attack on Saudi Arabia's airport. This happened before the arrival of Japanese Prime Minister to Iran, which was a historic visit to reduce tensions in Middle East.

If the Fed's benchmark interest rate really drops in the near future, then it’s likely that value of dollar-based assets will be corrected. Moreover, in six days, the Fed's policy-making committee (FOMC) will hold a meeting, which could announce a reduction in interest rates at that time.

As a result, investors will most likely tend to shift their assets to safe-haven forms other than the US dollar. Which gold might be their favorite

Source: https://www.liputan6.com/bisnis/read/3988473/ketidakpastian-perang-dagang-picu-harga-emas-menguat