Gold hits six-year high as geopolitical tensions bubble – business live | Business

Gold hits six-year high as geopolitical tensions bubble – business live | Business


A man monitors stock prices at a brokerage in Beijing today

A man monitors stock prices at a brokerage in Beijing today, as most Asian markets fell Photograph: Ng Han Guan/AP

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Jitters over the US-China trade war and tensions in the Middle East continue to buffet markets.

Overnight, Iran has hit back at America’s decision to impose new sanctions on its supreme leader, Ayatollah Ali Khamenei, saying it has slammed the door of diplomacy shut.

So, with president Trump accusing Iran of “increasingly provocative actions”, the threat of military action in the Gulf hasn’t gone away.

The White House

President Trump has just signed an executive order to deny Iran’s Supreme Leader and his associates access to key financial resources and support.

June 24, 2019

Most Asian stock markets have dipped overnight, and we’re expecting a weaker start in Europe too.

Investors have one eye on the Middle East, and another on the upcoming G20 meeting of world leaders in Japan.

The markets would like to see Trump cut a ceasefire deal with president Xi. But China isn’t rolling over; yesterday, Chinese Vice Commerce Minister Wang Shouwen said both sides need to compromise. Hawkish US officials aren’t in the mood to compromise on issues like forced technology transfer, though.

So faced with this picture, investors are piling into safe-haven assets.

Gold has hit a six-year high today, currently changing hands at $1,426 per ounce for the first time since 2013 (when eurozone crisis worries were raging). That’s an increase of nearly 1%, adding to recent gains.

The gold price

The gold price Photograph: Refinitiv

Ipek Ozkardeskaya, analyst at London Capital Group, says money is “pouring into gold”.

She adds:

Investors are reluctant to move their capital elsewhere in the middle of a worsening US-Iran thunderstorm and ahead of the G20 summit.

Traders are also shunning the US dollar, which is on its longest losing stretch in a year and a half.

They’re expecting the Federal Reserve to start slashing interest rates next month, especially now Trump is accusing them of childish incompetence…

Donald J. Trump

Despite a Federal Reserve that doesn’t know what it is doing – raised rates far too fast (very low inflation, other parts of world slowing, lowering & easing) & did large scale tightening, $50 Billion/month, we are on course to have one of the best Months of June in US history…

June 24, 2019

Donald J. Trump

….Think of what it could have been if the Fed had gotten it right. Thousands of points higher on the Dow, and GDP in the 4’s or even 5’s. Now they stick, like a stubborn child, when we need rates cuts, & easing, to make up for what other countries are doing against us. Blew it!

June 24, 2019

Also coming up today

In London, MPs will be questioning the Financial Conduct Authority. Andrew Bailey, head of the City watchdog, can expect some tough questions over the Neil Woodford crisis.

We’re also expecting new UK retail sales figures, and US consumer confidence and housing data — which may bolster the case for an interest rate cut.

The agenda

  • 1oam BST: The FCA testifies to the UK Treasury Committee
  • 11am BST: CBI survey of UK retail sales in May released
  • 2pm BST: US house price index for May
  • 3pm BST: US consumer confidence stats for June


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