The gold bulls have been leaving no doubt of their strength this week, with the yellow metal trading at eight-month highs yesterday (Thursday). The price gains come on the back of an uptick in new jobless claims, disappointing housing data and worries that Russia’s invasion of Ukraine could now come at any time, with Western nations including the USA accusing President Vladimir Putin of creating a ‘pretext’ to go to war.
The White House accused Russia of further growing its presence on the border yesterday, saying thousands more troops, 20 helicopters and a field hospital had been deployed. The US Secretary of State also warned the UN Security Council that Russia could report a fake bomb attack or chemical attack in the coming days in order to create a pretext to invade. His comments triggered safe haven demand for gold, with a £15 ($20) price increase, taking gold to £1,397 ($1,902).
Also helping gold to its strong performance was a surprise increase in the number of new jobless claims – something that could suggest that the economy is beginning to stall amid inflation pressures and supply chain issues. The latest figures from the U.S. Labor Department show 248,000 new claims registered, an increase of 23,000. This was higher than economists had expected, as forecasts had called for just 217,000 new claims.
A fall in housing starts, confirmed by new figures from the Commerce Department also helped gold inch ever closer to £1,398 ($1,903). New starts slumped to a 4.1% decline, due to supply chain issues holding up materials and a shortage of labour.
With gold closing out the week with strong forward momentum, act fast to buy now.
