(FILES) A worker polishes gold bullion bars at the ABC Refinery in Sydney on August 5, 2020. (Photo by DAVID GRAY / AFP)
Gold prices were boosted to a record high above $4,800 per ounce on Wednesday, as investors looked to the metal as a safe haven after a broad selloff in U.S. assets on heightened tensions between the U.S. and NATO over Greenland.
Spot gold climbed 2.1% to $4,862.46 per ounce by 0446 GMT, after scaling a record $4,865.73 earlier in the session. U.S. gold futures for February delivery climbed 2% to $4,861.20 per ounce.
"It's the loss of trust in the U.S. caused by Trump's moves over the weekend to tariff European countries and increase coercion in trying to take Greenland. (The move in gold) reflects fears about global geopolitical (tensions)," said Kyle Rodda, a senior market analyst at Capital.com.
On Tuesday, Trump said there was "no going back" on his goal to control Greenland, refusing to rule out taking the Arctic island by force and lashing out at NATO allies.
He later said, "we will work something out where NATO is going to be very happy and where we're going to be very happy."
Meanwhile, French President Emmanuel Macron said Europe would not give in to bullies or be intimidated, in a scathing criticism of Trump's threat of steep tariffs at Davos if Europe does not let him take over Greenland.
"I think crossing $4,800 just reinforces that, people don't want to sell gold before $5,000. It's a combination of the traditional supporters for gold, which is rising debt, a weakening dollar and geopolitical uncertainty," said Nicholas Frappell, global head of institutional markets at ABC Refinery.
The dollar index languished at a near one-month low after White House threats over Greenland triggered a broad selloff in U.S. assets, from the currency to Wall Street stocks and Treasury bonds.
A weaker dollar makes greenback-priced metals cheaper for overseas buyers.
Spot silver fell 0.1% to $94.48 an ounce, after hitting a record high of $95.87 on Tuesday.
Spot platinum lost 0.5% to $2,449.98 per ounce after hitting a record $2,511.80 earlier in the day, while palladium was up 0.1% at $1,866.46. - Reuters
