Gold Gains as Trump Shocks Markets by Doing What He Said He’d Do – by Luzi-Ann Javier and Eddie Van Der Walt (Bloomberg News – January 31, 2017)

https://www.bloomberg.com/

President Donald Trump’s policies have brought gold back to life. Gold futures rose for a second day, posting the biggest monthly gain since June, on investor concern over moves by Trump that included barring entry by citizens from seven predominantly Muslim nations and firing the acting U.S. attorney general for refusing to enforce the order.

The dollar headed for a third straight decline against a basket of 10 currencies, and U.S. stocks slid. Confusion over U.S trade and immigration policies has helped rekindle haven demand for gold, which in December capped its biggest quarterly decline in more than three years.

Money is also flowing back to precious metals as speculation mounts that the Federal Reserve may be more cautious in raising U.S. interest rates amid concerns Trump’s policies could stifle economic growth. Protests from New York to Atlanta to Detroit were held Sunday.

“There’s a lot of uncertainty and a lot of backlash over recent administration policies and that’s causing uncertainty in the market, and then all of a sudden the gold market has come back to life,” Phil Streible, a senior market strategist at RJO Futures in Chicago, said in a telephone interview. “The Fed may be slightly more cautious. It’s one thing to bring back jobs, but it’s another thing to cause protests and instability.”

Gold futures for April delivery advanced 1.3 percent to settle at $1,211.40 an ounce at 1:42 p.m. on the Comex in New York, taking this month’s gain to 5.2 percent. That’s the biggest monthly rally for a most-active contract since Britain’s decision to leave the European Union in June.

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