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Gold gains as Brussels blasts spur safe-haven buying

March 24, 2016


NEW YORK: Gold rose on Tuesday as investors sought assets seen as havens from risk after deadly bomb attacks hit Brussels airport and a rush-hour Metro train in the Belgian capital.

Islamic State claimed responsibility for the attacks which killed at least 30 people, triggering security alerts across Europe that brought some cross-border traffic to a halt.

Spot gold rallied more than 1 percent to a high of $1,259.60 an ounce following the attacks, before paring some of those gains.

At 4:08 p.m. EDT (2008 GMT), it was 0.3 percent higher at $1,248 an ounce. U.S. gold futures for April delivery settled up $4.40 an ounce at $1,248.60.

“We had knee-jerk reactions across the financial world when tragic events in Brussels were revealed. And then there was a partial snapback,” said Bill O’Neill, co-founder of commodities investment firm Logic Advisors in New Jersey.

“Longer term, the situation in Europe is likely to worsen and is supportive for gold,” he said referring to expectations of a prolonged era of ultra-low interest rates.

European stocks fell and investors rushed for the safety of government bonds in the immediate aftermath of the explosions.

Global equity markets later reversed losses and safe-haven gold and government bonds eased as the dollar rose after the euro and sterling weakened following the attacks.

Haven buying sparked by the news helped offset comments from Atlanta Federal Reserve President Dennis Lockhart that the United States may be in line for an interest rate rise as soon as next month.

Speculation rates would rise had pushed gold down 10 percent last year but it has rebounded 20 percent so far in 2016.

Elsewhere, data from the Swiss customs bureau showed Switzerland’s gold exports fell to an 18-month low in February as shipments to leading gold consumers India, China and Hong Kong slumped from the previous month.

Silver was up 0.2 percent at $15.86 an ounce, platinum gained 1.2 percent at $996.50 an ounce and palladium was 0.8 percent higher at $607.50 an ounce, a four-month high.



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