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Gold Prices Steady After Havens Rally on Attacks in Saudi Arabia

Investing.com -- Gold prices stabilized around $1,510 an ounce on Monday after the attacks on Saudi Arabian oil installations at the weekend triggered a flight to safety in global financial markets that benefited almost all haven assets.

By 9 AM ET (1300 GMT), gold futures for delivery on the Comex exchange were quoted at $1,509.85 a troy ounce, up 0.8% from late Friday, albeit off an intraday high of $1,519.65.

Spot gold was quoted up 0.9% at $1,501.93 an ounce.

The move upward in gold echoed that in bonds, where yields fell sharply in response to the attacks. The 30-year Treasury bond yield, after a sharp sell-off last week, fell eight basis points to 2.30%. Bond prices move inversely to yields.

European bond yields have also risen broadly, although they remain at much lower levels after the European Central Bank ensured a lasting bid for them by reviving its quantitative easing program at last week’s policy meeting.

Attention this week will be focused on the Federal Reserve, where the Federal Open Market Committee will hold its regular meeting on Tuesday and Wednesday. According to Investing.com’s Fed rate monitor tool, the chance of a 25 basis-point cut in the Fed funds target range has now fallen to 78%, its lowest in several weeks, after stronger-than-expected retail sales and consumer sentiment data on Friday undercut the case for aggressive policy easing.

Against the backdrop of easier global monetary policy, gold remains a core strategic recommendation for many analysts. Cross-asset strategists at JPMorgan (NYSE:JPM) expect a modest pull-back to $1,485 by the end of this month, but still see gold rising to over $1,710 by June next year.

Elsewhere, silver futures recovered 1.9% to $17.89 an ounce, while platinum futures fell 0.1% to $951.20.

Industrial metals retreated. Copper futures were down 1.1% at $2.67 a pound, while nickel futures fell 3.0% to $17,212 a ton.

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