Gold prices stayed at highs reached last year in November in Asian trade on Wednesday as geopolitical risk on the Korean peninsula escalated with tweets by President Donald Trump warning North Korea the U.S. would “solve the problem” of repeated missile and nuclear tests by the reclusive regime if its ally China failed to act first.
Gold for June delivery on the Comex division of the New York Mercantile Exchange rose 0.38% to $1,279.05 a troy ounce.
Overnight, gold prices traded higher on Tuesday, as investors fled risk assets and sought refuge in safe-haven gold amid rising geopolitical tensions, after expectations grew the U.S. may take military action against North Korea.
The U.S decided to move a Navy strike group toward the Korean peninsula amid continued missile tests by North Korea.
Meanwhile, President Donald Trump tweeted on Tuesday, “North Korea is looking for trouble” and signalled that the U.S. is prepared to solve the problem on its own, should China decline to offer assistance.
U.S.-Russia relations were also subject to further strain, after U.S. Secretary of State Rex Tillerson delivered a message to Moscow on Tuesday denouncing Russian support for Syria’s Bashar al-Assad.
Elsewhere, uncertainty concerning the result of the first round of French presidential elections on April 23, boosted demand for the yellow-metal.