December 19, 2019
Gold price was up by 0.2% at $1477.80 per ounce after the US House of Representatives voted to impeach US President Donald Trump.
Donald Trump became the third US President to be impeached after Mr Johnson in 1868 and Bill Clinton, in 1998. Democratic led House formally charged him with abuse of power and obstruction of Congress in a historic step that will inflame partisan tensions across a deeply divided America.
Gold seen as alternative investment during times of political and financial uncertainty.
Although the reaction to the impeachment was largely muted, Asian shares pulled back from a one-and-a-half year peak, while the U.S. dollar eased slightly against a basket of currencies.
If the U.S. Senate convicts, "which would be unexpected, then that throws next year's election in a very uncertain place," Ilya Spivak, a senior currency strategist at DailyFx said, adding that gold prices will then gain on risk aversion.
Two U.S. Federal Reserve policymakers on Wednesday said the U.S. economy is in good shape following three interest-rate cuts this year, reiterating the consensus at the Fed for keeping borrowing costs where they are for the time being.
Strong U.S. manufacturing output in November also cemented Fed's view. Gold is highly sensitive to any reduction in interest rates, which decreases the opportunity cost of holding non-yielding bullion.
Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, rose 0.3% to 883.29 tonnes on Wednesday.« Back to News & Reports List