Gold Higher on Safe-Haven Buying, Bullish Outside Markets

Author: Paul Ploumis11 Jun 2015 Last updated at 04:14:01 GMT

(Kitco News) - Gold prices ended the U.S. day session higher Wednesday, on some safe-haven demand. More short covering and bargain hunting were also seen. The key “outside markets” were in a bullish daily posture for the precious metals today, as the U.S. dollar index was lower and crude oil prices were higher. August Comex gold was last up $9.20 at $1,186.80 an ounce. July Comex silver was last up $0.003 at $15.96 an ounce.

Safe-haven gold today benefitted from U.S. and German government bond markets getting hammered again. Only two months ago the German 10-year bund yield was just 0.05%. Now the bund yield has pushed above 1.0%. September U.S. Treasury bond futures prices hit a new contract low Wednesday. The roiled bond markets are due in part to worries about rising inflation pressures and warnings from the European Central Bank that higher bond market volatility could be the norm, going forward.

The Greece-EU/IMF debt negotiations are ongoing and still no formative agreement has been reached on restructuring Greece’s sovereign debt. EU/IMF officials this week rejected the latest proposal from Greece. Greece appears to be dragging its feet on meaningful reforms as the nation is running out of cash. This situation is also blamed for the European bond market turmoil and has also prompted some safe-haven demand for gold.

The London P.M. fix is $1,188.50 versus the previous A.M. fixing of $1,186.00.

Courtesy: Kitco News