Gold News: Devaluation Of Yuan Sparks Gold Comeback
Gold News: Devaluation Of Yuan Sparks Gold Comeback
The uncertainty in the Chinese market and the devaluation of the yuan has lead to investors returning to gold as a safe haven. Although the commodity suffered the biggest monthly drop in two years, gold has risen every day in August. Gold futures in New York climbed for a fifth day, the longest run since May, to a three-week high. According to Ross Norman, chief executive officer of Sharps Pixley, a London-based metal dealer “The gold price is the sum of all fears, and we’re seeing a reflection of nervousness in the market following the yuan devaluation,”
The devaluation of the yuan on Tuesday sparked concern worldwide as it highlighted the slowdown in the world’s second-largest economy. This slowdown has lead to an a rise in bullion, an alternative store of value, which usually occurs due to currencies weakening.
“Some investors are flocking to gold as the devaluation sparked broader concerns for currencies and economic growth,” Fu Peng, a portfolio manager at Lianzhan Global Macro Fund Management Co was quoted saying. Gold futures for delivery in December rose 1.4 percent to settle at $1,123.60 an ounce. While Gold of 99.99 percent purity had the biggest such gain in more than six year as it jumped 5.6 percent in two days.
