Gold prices around one-year highs as N. Korea tensions linger

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Gold prices around one-year highs as N. Korea tensions linger

Dubai - Asian traders cautious after sell-off

By Agencies/Web Report

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Published: Tue 5 Sep 2017, 7:46 AM

Last updated: Tue 5 Sep 2017, 12:49 PM

Gold prices on Tuesday edged away from their highest in nearly a year as the dollar steadied, though safe-haven demand continued to support the precious metal in the wake of North Korea's most powerful nuclear test to date.
Asian markets struggled on Tuesday while the safe-haven yen and gold held gains as traders fret over North Korea's nuclear test at the weekend, which prompted warnings of US military action.

The US ambassador to the United Nations Nikki Haley told an emergency Security Council meeting that Pyongyang was "begging for war" and called for the "strongest possible measures" against Kim Jong-Un's regime.

Also, US President Donald Trump and his South Korean counterpart Moon Jae-In agreed to remove limits on the payload of the South's missiles.

The test, which North Korea says was of a hydrogen bomb, came less than a week after it fired a rocket over Japan, while speculation mounts that it is preparing to launch another.

Sunday's provocative test sparked heavy selling in Asian stocks Monday and markets were unable to stage any meaningful recovery on Tuesday.

Seoul was barely moved, having shed more than one percent the day before, while Tokyo dropped 0.5 percent by the break as exporters were weighed by the stronger yen.

Hong Kong was also flat and Shanghai, which managed to eke out gains Monday, eased 0.2 percent. Wellington and Singapore were slightly higher.

"Investors in Asia have limited leads to follow," Citigroup analysts led by Johanna Chua wrote in a client note, according to Bloomberg News.

They added that the North usually ramps up the belligerence around key anniversaries, the next of which is expected on September 9.

"Tension linger and it's difficult for risk aversion sentiment to disappear," Naoto Ono, a currency analyst at Ueda Harlow in Tokyo, said in a note.

Analysts said traders will be keeping an eye on Wall Street's reaction to the latest events, having been closed Monday for Labor Day.

On currency markets the yen maintained its gains against the dollar as investors sought out safety, while gold held around one-year highs.

In Dubai, gold prices were the following:

- 24 carat: Dh161.50
- 22 carat: Dh151.75
- 21 carat: Dh144.75
- 18 carat: Dh124.25


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