Gold prices high on fiscal cliff uncertainties

On Thursday, gold prices inched higher hitting the highest level in two weeks. The rescue deal against the fiscal cliff supported the prices on the way up, though the end of the budget talks is yet to come and the issues in the US are still present.

The yellow metal started 2013 scoring a multi-week high. This came as result of the bill passed by the US legislators on Wednesday. The bill increases ensure tax relief for average and low-income citizen, while raises the stakes for high-earning individuals.

Read more: Gold’s golden age maybe coming to an end

Though, the fiscal cliff issue has another part which was left unsolved. About $109 billion domestic and military spending cuts has to be wisely disputed as soon as possible in order to prevent automatic budget cuts.

In times of such risky economic times, gold is seen a perfect store of value with a sanctuary status by many market players. Traders however may opt for stocks now, because the stock markets offer faster, even if more riskier returns. The physical metal activities have been cautiously observed across the stock markets, which are not certain about the effect of the fiscal cliff development.

By 06:46 GMT gold was up by $1.35 hitting a high of $1,687.70 per ounce. In the previous session, the commodity reached two weeks high above the $1,690 threshold.

By the end of 2012, the yellow metal reached it’s 12th year of gains in a row with 7% bullish run at the end of the period. History has no such record for longer bullish gain.

US gold for February was pretty steady trading at $1,688.30 per ounce.

Precious metals are locked in the next trading range, despite the fact that they are following equities at the moment.

Gold supply had yet to recover after the Christmas and New Year holidays as premiums for bullion bars traded flat in Singapore about $1.10-$1.20 per ounce to the spot prices in London. The purchase power of Indian traders as top player was put sideways.

The Central Bank in India demanded for value and volume limitations on gold imports from agencies and banks. Indian jewelers won’t be happy with this step, because it will cause certain effects on them. Such restrictions have been already used in countries like Thailand and Vietnam.

Resources for gold investors:

Research additional information:
Gold Price Increase Gathers Pace as Interest Rates Hike Seem More Distant Gold futures edged higher on Wednesday as traders await minutes of the U.S. Federal Reserve’s April meeting for clues on interest-rate policy. Most ...
Central Banks, Asian Consumers Remain Committed Gold Buyers Asian consumers and global central banks continue to act as a long-term underlying support to the gold market with on-going physical demand. The lates...
Dubai’s Gold Souk Suffers Lack of Demand Shopkeepers in Dubai's Gold Souq say sales are declining because tourists from Saudi and Russia have less cash to spend. But experts reveal harsher re...
Gold Prices Trending Higher Last Friday, gold futures advanced for a third-straight session in a row to end up nearly 2% for the week. Prices for the yellow metal had risen by m...
A mini bull run for gold? Gold prices advanced on Monday in electronic trading, moving above last week’s highs as the equity market continued to wobble. A mini bull run for g...
Gold prices seen higher in the weeks ahead Gold prices are expected to rise in the coming weeks building strength on the previous weeks' gains. On Friday, the yellow metal tallied a five-week ...
Precious metals off to big start in 2014 Gold had its biggest day in three weeks on Thursday, up 1.8% to $1,224 per ounce. Silver was also higher by 3.3%, with optimism about boosted demand f...
Friday’s Sell-off Doesn’t Spell Good News For Gold December gold futures fell 3.19% last Friday, settling at $1,332.50 an ounce on the Comex division of the New York Mercantile Exchange. Futures prices...
Gold Advances Aggressively on Unchanged QE Policy Gold futures pushed higher in early electronic trade on Thursday. The Federal Reserve’s surprise move on Wednesday promising to keep the cash flowin...
Gold prices broadly expected to weaken next week, but… Gold prices are expected to weaken in the coming week. This belief is mainly driven by investors concerns about what action the U.S. Federal Reserve w...