Gold eases on profit-booking after breaching US$4,600/oz

[BENGALURU] Gold eased on Tuesday (Jan 13), a day after breaching US$4,600/ounce for the first time ever, as investors booked profits amid heightened geopolitical and economic uncertainty.

Spot gold fell 0.4 per cent to US$4,576.79 per ounce as at 9.34 am. Bullion hit a record high of US$4,629.94 on Monday.

US gold futures for February delivery lost 0.6 per cent to US$4,585.40.

US President Donald Trump said on Monday that any country that does business with Iran will face a 25 per cent tariff on trade with the US, as Washington weighs a response to the situation in Iran which is seeing its biggest anti-government protests in years.

Iran’s unrest comes as Trump flexes US muscles internationally, having ousted Venezuelan President Nicolas Maduro, and discussing acquiring Greenland by purchase or force.

The US dollar held to its losses but hovered near one-month highs after the Trump administration opened a criminal investigation into US Federal Reserve chair Jerome Powell, a move that threatens the central bank’s independence and faith in US assets.

The Trump administration’s decision to investigate Powell drew condemnation from former Fed chiefs and a chorus of criticism from key members of the Republican Party on Monday.

Meanwhile, major brokerages such as Goldman Sachs and Morgan Stanley expect two 25-basis-point rate cuts each in June and September.

Non-yielding assets tend to do well in a low-interest-rate environment and during geopolitical or economic uncertainties.

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Gold, silver notch record highs on safe-haven demand, Fed rate-cut bets

Spot silver shed 1.6 per cent to US$83.62 per ounce after hitting an all-time high of US$86.22 on Monday.

Spot platinum lost 2.5 per cent to US$2,283.95 per ounce after scaling a record peak of US$2,478.50 on Dec 29.