Gold prices are again modestly higher in last night trading and hit a two-week high in US dollars. Short covering and bargain hunting have been featured the past few sessions, as gold prices have risen around $25 from the lows posted less than two weeks ago. Now, some safe-haven demand is also surfacing due to unrest in Iraq. August Comex gold was last up $4.30 at $1,265.60 an ounce. Spot gold was last quoted up $4.90 at $1,266.00. July Comex silver last traded up $0.098 at $19.265 an ounce.
Iraq is back in the news headlines again, as civil war has broken out in that country amid escalating violence. Iraq’s ruling government is calling on the U.S. for military aid, although such is not likely. Crude oil prices are sharply higher Thursday, mostly on the Iraq news. Gold is also seeing modest safe-haven buying support on the news. The bigger worry is that the violence in Iraq could spread to other Arab countries.
In other overnight news, industrial production in the European Union rose 0.8% in April from March and was up 1.4% year-on-year. The increase was a bit larger than forecast.
U.S. economic data due for release Thursday includes the weekly jobless claims report, import and export prices, and retail sales.
And let us not forget about Ukraine when it comes to geopolitical risks. There have been reports from last night that three Russian tanks crossed the border at a rebel controlled checkpoint in the Luhansk region, amid escalated fighting. While focus has shifted back to the Middle East, risks in Eastern Europe remain considerable.