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PRECIOUS-Gold hits more than 6-year high on Hong Kong, Argentina

Published 2019-08-13, 07:45 a/m
© Reuters.  PRECIOUS-Gold hits more than 6-year high on Hong Kong, Argentina
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* SPDR Gold holdings up 0.9% on Monday

* Silver touches more than 1-1/2 year high

* U.S. 30-year bond yields slip to lowest since July 2016

* GRAPHIC-2019 asset returns: http://tmsnrt.rs/2jvdmXl (Updates prices)

By K. Sathya Narayanan

Aug 13 (Reuters) - Gold hit a more than six-year high on Tuesday as unrest in Hong Kong and a rout in the Argentine peso drove investors already spooked by the U.S.-China trade war into havens such as bullion at the expense of riskier assets such as stocks.

Spot gold XAU= was up 1% at $1,525.99 per ounce as of 1123 GMT, off a day high of $1,534.31 - its highest level since April 2013.

U.S. gold futures GCcv1 was up 1.3% to $1,537 an ounce.

"Bond yields and equities are down which are the main reason for gold to be higher. There is a bit of safe-haven (interest)," ABN Amro analyst Georgette Boele said. "People are nervous about Hong Kong again, and that's why Asian markets were down."

Share markets slid for a third day on Tuesday as investors were spooked by fears of a drawn-out global trade war, the Hong Kong protests and a crash in the peso. MKTS/GLOB

In Hong Kong, pro-democracy protesters on Monday managed to shut down the city's airport, the world's busiest air cargo hub. Argentina's peso ARS= collapsed on Monday, losing roughly 15% of its value against dollar after crumbling to an all-time low. of a possible return to interventionist policies of the previous government have gripped the Argentine market since market-friendly President Mauricio Macri lost a primary election by a bigger-than-expected margin. along with the Japanese yen and U.S. Treasuries, is seen as a relatively safe investment in times of political and financial uncertainty.

The yen JPY= rose to a seven-month high against the dollar in the previous session, while U.S. 30-year bond yields US30YT=RR extended Monday's losses to slip to their lowest since July 2016. USD/ US/

Analysts said negative debt yields around the globe were further supporting bullion. Non-interest bearing gold tends to benefit when yields on other assets are low.

Market focus is now on the U.S. Federal Reserve's annual symposium next week for clues on the future trajectory of interest rates. Traders see a 69% chance of a 25 basis-point rate cut by the U.S. central bank this September. FEDWATCH

On the technical front, "a solid breakout and daily close above the $1525 level is likely to inject gold bulls with enough inspiration to challenge $1,550," FXTM analyst Lukman Otunuga said in a note.

Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust GLD , jumped 0.9% to 847.77 tonnes on Monday. GOL/ETF

Among other precious metals, silver XAG= climbed 2% to $17.40 per ounce, having touched its highest since January 2018. Platinum XPT= rose 1.4% to $864.77, while palladium XPD= gained 0.5% to $1,434.68 an ounce.

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http://tmsnrt.rs/2jvdmXl

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