Tokyo gold futures rose to a one-month high on Wednesday as reports that North Korea had launched several missiles spurred buying of traditional safe-haven assets.
The benchmark June 2007 gold contract on the Tokyo Commodity Exchange rose as high as 2,368 yen per gram, up 40 yen or 1.7 percent from Tuesday and the highest price since June 1. At the end of the session, it was up 28 yen at 2,356.
"Gold is buoyant as the missile launches by North Korea have added to geopolitical tensions already heightened by Iran's nuclear programme," said Tatsuo Kageyama, an analyst at Kanetsu Asset Management.
North Korea launched at least six missiles on Wednesday, including a long-range Taepodong-2, a move Washington called provocative and in defiance of the international community. The Taepodong-2, which some experts say may be able to reach Alaska, apparently failed 40 seconds into its flight, US officials said.
The volume of TOCOM gold traded on Wednesday reached hefty 85,893 lots as funds and retail investors bought the metal. This compared with turnover of 160,142 lots for the whole day on Tuesday and 96,543 on Monday.
Spot gold was quoted at $628.10/85 an ounce. It rose as high as $630.50 an ounce in the day, gaining $9.00 or 1.4 percent from Tuesday's last-quoted level. TOCOM gold was also lifted on Wednesday by the yen's fall against the dollar as the Japanese currency came under selling pressure following the missile launches.
The dollar was at 114.90 yen after rising as high as 115.24 yen on trading platform EBS. The dollar was buying 114.55 yen in late London trading on Tuesday, when US markets were closed for the Independence Day holiday.
Analysts said the yen's fall was limited by growing expectations the Bank of Japan would raise overnight interest rates from zero next week, the first such move in six years.
Comments
Comments are closed.