Gold Prices Rise After Latest North Korea Comments
By Amrith Ramkumar
Gold prices climbed Monday after North Korea's foreign minister called President Donald Trump's latest comments a declaration of war.
Gold for December delivery turned positive following the comments and was recently up 0.7% at $1,307.10 a troy ounce on the Comex division of the New York Mercantile Exchange. Gold had its worst week since early July last week and has fallen in consecutive weeks after hitting its highest level in more than a year earlier this month, in part because of easing tensions between the U.S. and North Korea.
However, rhetoric between the two countries escalated again Monday when North Korea's Foreign Minister Ri Yong Ho responded to Mr. Trump's weekend comments by saying the threat was "clearly" a declaration of war.
Mr. Trump had earlier responded to a Saturday warning from Mr. Ri that a missile attack on the U.S. mainland had become "inevitable" by tweeting over the weekend that "If he echoes thoughts of Little Rocket Man [ Kim Jong Un], they won't be around much longer!"
Monday's comments stoked demand for gold and other haven assets because many investors favor them during times of geopolitical uncertainty.
"You're going to continue to see limited selling interest in the gold market because of this North Korean situation," said Jim Wyckoff, senior analyst at Kitco Metals.
Gold prices had edged lower before Mr. Ri's Monday comments after investors shook off the weekend warnings between the two countries. Prices were little changed following Chancellor Angela Merkel's conservative alliance winning the German election despite a steep drop in support and an anti-immigrant party surge, signaling possible turbulence ahead for Europe's largest economy.
Still, many analysts have said they expect geopolitical tensions to keep a floor on gold prices moving forward. Tensions have also been rising recently between the U.S. and Iran.