(Oct 13): Silver swung near a record as an historic short squeeze in London and US-China trade tensions roiled the market, while gold set a new peak. Elsewhere, fears over potential White House tariffs on gold\u2019s precious metal peers drove platinum and palladium sharply higher.<\/p>\n
Silver rose as much as 1.1% to approach US$51 (RM215.42) an ounce, while platinum and palladium were both up more than 2%. Gold set a record above US$4,060 an ounce, after notching an eighth straight weekly gain on Friday.<\/p>\n
Precious metals have surged this year, with the complex\u2019s main quartet of members surging between 50% and 80%, in a rally that\u2019s dominated commodity markets. Gold\u2019s advance has been underpinned by central-bank buying, rising holdings in exchange-traded funds, and rate cuts by the Federal Reserve (Fed). Demand for havens has also been aided by recurrent US-China trade tensions, threats to the Fed\u2019s independence, and a US government shutdown.<\/p>\n
On Sunday, China urged Washington to halt tariff threats and return to negotiations, warning it would retaliate if the US pressed ahead with new measures. US President Donald Trump \u2014 who had threatened an additional 100% tariff on Chinese goods last week \u2014 struck a more conciliatory tone in remarks at the weekend.<\/p>\n
\u201cIt seems just when geopolitical and trade risks were diminishing tailwinds for gold, we\u2019ve got this flare-up in US-China tensions,\u201d said Kyle Rodda, an analyst at Capital.com. Despite both sides\u2019 openness to further negotiations, \u201ctrade volatility may go silent but it never disappears. That\u2019s a really good thing for gold.\u201d<\/p>\n
Traders remain on edge ahead of the conclusion of the US administration\u2019s so-called Section 232 investigation into critical minerals \u2014 which includes silver, platinum and palladium. Fears that the metals could be swept up in Trump\u2019s levies have exacerbated market tightness, partly laying the foundations for the squeeze in silver following a massive drawdown of freely available supplies in London.<\/p>\n
Concerns about a lack of liquidity in London drove silver closer to a US$52.50 an ounce record from 1980 \u2014 set on a now-defunct contract on the Chicago Board of Trade exchange. Benchmark prices in London have soared to near-unprecedented levels over New York, prompting some traders to book slots in the cargo holds of transatlantic flights for silver bars \u2014 an expensive mode of transport typically reserved for more valuable gold \u2014 to profit off the massive premiums in London.<\/p>\n
Spot gold rose as much as 1.1% to US$4,060.01 an ounce, and traded US$4,028.28 at 8.12am in Singapore. The Bloomberg Dollar Spot Index was little changed, after gaining about 1% last week. Silver was up 0.7%, holding above US$50 an ounce. Platinum was near US$1,630 an ounce, while palladium was around US$1,445 an ounce.<\/p>\n
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