Gold prices rise after Trump's State of the Union speech
Trump's comments come ahead of another planned round of talks between US and Iran, which are set to resume in Geneva on Thursday.
SEATTLE (Scrap Monster): Gold prices rose on Wednesday morning, as investors digested comments made by US president Donald Trump in his State of the Union address.
Gold futures were up 0.6% to $5,205.80 per ounce at the time of writing, while spot gold climbed 0.7% to $5,180.91 an ounce.
In his address on Tuesday evening, Trump defended his tariffs and proclaimed that no changes are in the offing as 'the deals are all done'.
The president also condemned 'the Supreme Court's unfortunate involvement', in ruling against his broad-based tariffs. In the speech, Trump claimed that the duties would eventually “substantially replace the modern-day system of income tax'.
Hours after the US Supreme Court said that it had ruled Trump's global tariffs unlawful on Friday, the president announced that he would be imposing a new 10% duty, using authority under section 122 of the Trade Act of 1974.
The president then threatened on Saturday to raise his new tariff to 15%, but has yet to formally implement this rate. Bloomberg reported that the White House is working on a formal order that will raise the global tariff rate to 15%. The 10% tariff rate came into effect on Tuesday.
The resurgence in trade uncertainty has boosted demand for gold as a so-called safe-haven asset, driving prices higher.
Trump's comments come ahead of another planned round of talks between US and Iran, which are set to resume in Geneva on Thursday.
ING head of commodities strategy Warren Patterson and commodities strategist Ewa Manthey said that 'without a deal, the probability of military action is high and growing'.
'President Trump’s 10-to-15-day deadline for Iran works out to a date sometime in very early March,' they said. 'This uncertainty means the market will continue to price in a large risk premium and remain sensitive to any fresh developments.'
Courtesy: www.finance.yahoo.com