Gold looks set for further growth as investors look for shelter from the volatile market. Photo/Getty Images.
Gold is closing out 2018 on a strong note, its haven demand reinvigorated by volatile trading in global equities, rising concern about the economic outlook and a drawn-out government shutdown in the US.
Spot bullion is holding near a six-month high after topping US$1,280 ($1907) an ounce, and the metal
is set for the best monthly gain in almost two years. December's rally has pared an annual decline, the first full-year loss since 2015.
Gold gained ground this quarter as world equities plunged and doubts stacked up about the pace of economic growth in 2019. A weakening dollar in December aided the rally amid expectations the Federal Reserve will dial back the pace of rate increases next year. That's also helped to boost holdings in gold-backed exchange-traded funds.
"For gold prices, I think there is upside to be seen in 2019," Jingyi Pan, market strategist at IG Asia Pte., told Bloomberg TV on Monday, citing prospects for fewer tightening moves from the US central bank. "It does look like one where we will see a slackening of expectations in Fed hikes."
Spot gold hit US$1,284.15 an ounce on Monday, the highest price since mid-June, and it's up 4.9 per cent this month, according to Bloomberg generic pricing. It was little changed at US$1,280.17 an ounce at 9:52 a.m. in New York.
