The louder the threats in the political arena are, the faster gold extends gains. Despite a considerable number of various assets, including popular cryptocurrencies, investors still mostly rely on gold when global political tension grows.
This time gold prices increased amid heated rhetorics between the US and North Korea. Amid threats of a nuclear attack by the North Korean dictator, gold prices jumped close to $1,300 per ounce. In addition to the manic hysterics of Kim Jong Un, gold growth was also supported by the recent terrorist attack in Barcelona. All safe-haven assets rose sharply after the news about the incident. In this context, the next portion of negative news that affects gold is not so serious. US President Donald Trump stated that, in his opinion, the US government stands in the way of implementing his pre-election promises. Of course, this disagreement is not a threat of a nuclear war but also has a negative impact on financial stability.
As for North Korea, experts say that unfortunately they do not see what can change the situation for the better. Nevertheless, the demand for gold is likely to remain high, as today the United States and South Korea launched joint military exercises. Commerzbank noted that this could aggravate the conflict between the US and North Korea, which has recently grinded to a halt.
