Gold futures rose, extending their best quarterly rally in more than a year as concern over China’s economic outlook weighed on global equities and industrial metals.
Bullion hit a six-month high, nearing $1,300 an ounce, after a report showing a contraction in China manufacturing renewed wild gyrations across equity markets, with Europe and Asia’s slumping, boosting demand for haven assets. Factory gauges in Italy and and Poland also sank. The dimming demand picture in China, the world’s largest base-metals user, pushed copper to its biggest loss in two weeks while an index of 70 mining companies slid.
Gold is rising on “more safe-haven buying interest amid a still very wobbly U.S. stock market,” Jim Wyckoff, senior analyst at Kitco Metals, said in a note to clients. “There was also some weaker economic data coming out of the European Union, to also un-nerve traders and investors.”
Bullion surged in the final quarter of 2018 as investors positioned themselves for a global slowdown, with fewer rate hikes expected from the U.S. Federal Reserve.
Worldwide holdings in gold-backed exchange-traded funds have jumped. Major parts of the U.S. government will remain shuttered for a 12th day as President Donald Trump meets with congressional leaders from both parties at a White House briefing Wednesday on border security.
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