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Gold remains headed for third weekly gain on Brexit anxiety

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Gold is headed for a third weekly advance on anxiety surrounding the UK's membership of the European Union, although prices fell Thursday from near a two-year high following the murder of a British lawmaker who had campaigned to remain in the bloc.

[SINGAPORE] Gold is headed for a third weekly advance on anxiety surrounding the UK's membership of the European Union, although prices fell Thursday from near a two-year high following the murder of a British lawmaker who had campaigned to remain in the bloc.

Bullion for immediate delivery rose as much as as 0.6 per cent to US$1,286.31 an ounce before trading at US$1,279.81 by 9:29 am Singapore time, according to Bloomberg generic pricing. The metal touched US$1,315.71 on Thursday, the highest since August 2014, after the Federal Reserve reined in its projection for rate increases over the next two years.

Prices are up 0.4 per cent this week and 21 per cent for the year, as gold has benefited from haven demand. Fed Chair Janet Yellen said Wednesday the June 23 Brexit referendum was a factor in the central bank's decision to keep interest rates on hold this week. The deathof Jo Cox, the first killing of a UK member of Parliament since the days of Irish Republican terrorism, may push voters toward remaining in the EU, which would be a balm for financial markets worried over the implications of a vote to leave.

"The tragic death of a UK politician saw the suspension of campaigning for the EU referendum and the GBP move higher, lessening the appeal of the precious metal," analysts at Australia & New Zealand Banking Group Ltd wrote in a report.

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