Gold on Wednesday held near six-week highs hit the session before, with economic and political uncertainty boosting its safe-haven appeal.
Markets were waiting for indications on policy from US President-elect Donald Trump’s first news conference since the US elections, due later in the day.
“The markets are myopic. There are immediate concerns over the global economy, at least in the first half of the year,’’ said Barnabas Gan, an analyst at OCBC Bank in Singapore.
He added that focus was on events such as Britain’s exit from the European Union, French elections in April and the impact of Trump’s trade policies when he takes up his post in the White House later this month.
Spot gold was little changed at $1,187.37 an ounce by 0303 GMT.
Bullion, often seen as an alternative investment during times of political and financial uncertainty, had on Tuesday reached its highest level since November 30 at $1,190.46. US gold futures gained 0.1 per cent to $1,187.20 per ounce.
“Greater than usual market sensitivity to Trump’s comments and actions may persist until the market becomes used to him in office. This could take several months. Thus gold prices may be more volatile than usual,” said James Steel, chief metals analyst for HSBC Securities in New York.
“In addition to US dollar weakness, the gold rally has depended on a pullback in US bond yields and some moderation in equity gains.”
The greenback has lost some of its momentum against other currencies, while US bond yields have fallen considerably from two-year highs touched in mid-December.
Gold is highly sensitive to rising US interest rates,which increase the opportunity cost of holding the non-yielding asset while boosting the dollar, in which it is priced.
Yellen’s townhall meeting
The outlook for US rates may become a little clearer when Federal Reserve Chair Janet Yellen appears at a webcast townhall meeting with educators on Thursday.
“There is uncertainty in the global economic space and it is not surprising to see precious metals, especially gold, pointing higher on the back of safe-haven demand,” OCBC’s Barnabas said.
Reuters technical analyst Wang Tao expects spot gold to rise to $1,210 per ounce as it has broken above resistance at $1,172.
Among other precious metals, silver was unchanged at $16.79 an ounce, after gaining over 1 per cent on Tuesday, when it hit its highest in nearly one month.
Platinum was 0.7 per cent lower at $971.74, and palladium fell 0.8 percent to $758.47 an ounce.