SINGAPORE. — Gold added to an overnight surge in prices yesterday, as escalating geopolitical tension in the Middle East and a global stock market rout triggered safe-haven bids for the metal. Spot gold had risen 0,2 percent to $1 075,95 per ounce by 4.44am GMT. On Monday, the metal jumped as much as 2,2 percent to a four-week high of $1 083,30, before ending the day up 1,3 percent. “The Middle East tension will continue to support gold for the time being,” said a trader in Hong Kong.
“If the decline in stock markets extends to another session, that may also help.” Bullion, often seen as a alternative investment during times of geopolitical and financial uncertainty, is benefiting from a shift away from risk along with the Japanese yen and US bonds.
Saudi Arabia’s execution of a Shiite Muslim cleric at the weekend provoked protests among Shiites across the region. Iranian protesters stormed the Saudi embassy in Tehran, setting fires and causing damage, prompting Riyadh to cut ties and inflaming an already heated rivalry.
Saudi Arabia also said it would end air traffic and trade links with Tehran. — Reuters.