Gold exchange traded funds are shining brighter, with bullion prices touching a 16-week high, as safe-haven demand supports gold’s allure.
COMEX gold futures now hover around $1,338 per ounce after falling 28% over 2013.
“There is some safe-haven buying because of continued signs of slowing growth in the U.S.,” Tom Power, a senior commodity broker at R.J. O’Brien & Associates, said in a Bloomberg article. “Concerns about Ukraine remain.”
U.S. economic activity for January was at a negative 0.39, compared to analysts’ median estimates of minus 0.2 – anything below-zero indicates below-trend growth.
Meanwhile, an interim government has been set up in Ukraine, following violent riots and subsequent ousting of President Viktor Yanukovych.
Bullion prices have also been strengthening despite the Federal Reserves’ decision to continue tapering its monthly bond purchasing program.
“The market is only reacting over U.S. figures,” Bernard Sin, head of currency and metal trading at bullion refiner MKS SA, said in the article. “The political situation has been rather tense. There’s some speculative interest in going into gold as a safe haven.”