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Global gold prices steady on US political uncertainty

LiveMint logoLiveMint 12-05-2017 Nallur Sethuraman

Bengaluru: Gold prices held firm on Friday on political uncertainty in the United States, but were set for their fourth straight weekly loss due to expectations of an interest rate hike by the US Federal Reserve in June.

Spot gold was unchanged at $1,224.63 per ounce at 6.33am. It hit an eight-week low of $1,213.81 an ounce on Tuesday.

US gold futures were also steady at $1,224.50 an ounce.

President Donald Trump on Thursday ran into resistance for calling ousted FBI chief James Comey a “showboat.” The attack that was swiftly contradicted by top US senators and acting FBI director Andrew McCabe, who pledged that an investigation into possible Trump campaign ties to Russia would proceed.

New applications for US jobless benefits unexpectedly fell last week, while producer prices rebounded strongly in April, pointing to a tightening labour market and rising inflation that could spur the Federal Reserve to raise interest rates in June.

Trade protectionism is a “dead end” that may score political points but will ultimately hurt the US economy, one of the most influential Fed officials said on Thursday in the central bank’s strongest defence yet of open borders in the face of a sceptical Trump administration.

Finance chiefs from the G7 begin a two-day meeting in Italy on Friday, with Europe, Japan and Canada hoping to come away with a clearer picture of US President Donald Trump’s direction on important policies that he has yet to spell out.

Euro zone economic growth should grow a bit faster this year than previously believed and the unemployment rate could be the lowest in a decade, the European Commission said on Thursday.

Platinum producer Lonmin said on Thursday protesters demanding jobs were disrupting output, damaging property and intimidating employees around its Marikana operations in South Africa.

South African-based precious metals producer Sibanye Gold plans to raise $1 billion through a rights issue to repay a portion of a $2.65 billion loan facility it used to acquire US platinum producer Stillwater

Egypt will announce the results of its gold mining exploration tender next week, Minister of Petroleum Tarek El Molla said on Thursday.

South Africa is set to avoid slipping into a technical recession this year following surprise improvements in mining and manufacturing output, although the economy remains under pressure due to recent credit downgrades to junk. Reuters

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