The Turkish downing of a Russian warplane did little to calm international anxiety but did wonders for the price of gold this week.
According to Kitco. News reports that Turkish jets shot down a Russian military aircraft put a modest bid into the safe-haven gold market Tuesday. Short covering and bargain hunting were also featured after gold prices recently hit a 5.5-year low. February Comex gold was last up $6.50 at $1,073.20 an ounce.
There was risk aversion in the marketplace Tuesday as reports said a Russian warplane was shot down by Turkey’s military. The Russian jet was near the Syrian border when Turkish fighter jets shot it down. Turkish officials said the Russian jet was over its territory and ignored warnings to turn back. Some NATO members concurred that the Russian plane was in Turkey’s airspace. However, Russia said its plane was not in Turkey when it was shot down. NATO officials are meeting later Tuesday in Brussels to discuss the matter. Russian president Vladimir Putin lashed out said his country was “stabbed in the back” by Turkey would retaliate to the downing of its jet. The effect the war or rather wars in Syria has on the price of gold proves yet again that for traders in the precious metal bad news is good news.
The uneasiness of the free world after the Paris terror attacks, the lockdown in Belgium and the U.S. government warning its citizens about traveling abroad also contributed to a “risk-off” attitude in the general marketplace.
There was an important U.S. economic report just out. The second estimate of third-quarter gross domestic product. The GDP figure came in at up 2.1% versus the last estimate of up 1.5%. The latest reading was right in line with market expectations and had very little impact on the marketplace.
According to Kitco. technically, February gold futures prices closed near mid-range. The gold bears still have the solid overall near-term technical advantage. Gold prices are in a steep five-week-old downtrend on the daily bar chart.
Another metal is also indicative of unquiet times— copper. A sudden surge in the price of copper could indicate and increase in the manufacture of arms and most ominously ammunition.
