Investing.com - Gold prices inched up on Wednesday, as political uncertainty in Italy continued.
Comex gold futures for June delivery were up 0.12% to $1,300.60 a troy ounce as of 10:32 AM ET (14:32 GMT).
The price of gold moved higher as Italy’s political crisis deepened. Last minute efforts to form a government seem unlikely, with the prospect of elections in July. Investors fear a snap election could become a de facto referendum on the euro.
Meanwhile trade tensions between the U.S. and China remained after U.S. President Donald Trump said Tuesday he would move ahead with $50 billion in tariffs on Chinese goods. Chinese officials responded overnight that while the news is surprising, it will protect its interests.
Gold, seen as a safe haven asset, often moves higher from political turmoil.
The price of bouillon was also driven up by a fall in the greenback, as the chances of a Federal Reserve rate hike in June falling to 85% following the turbulence in Italian politics.
Traders were also digesting disappointing economic data. The first-quarter economic growth of the U.S. was revised down to 2.2%, while ADP jobs data increased by 178,000 compared to the 190,000 forecast.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was at 94.37, near its earlier low of 94.21.
Gold is denominated in the U.S. currency and is sensitive to moves in the dollar. Bullion becomes more expensive for holders of other currencies when the dollar rises.
Elsewhere on the Comex, silver futures were up 0.50% to $16.455 a troy ounce. Among other precious metals, Platinum Futures rose 0.12% to $907.00 while Palladium Futures increased 0.02% to $971.20 an ounce. Copper futures slumped 0.41% to $3.050 a pound.