Gold prices rose, on Friday, due to the repercussions of the crisis of the Evergrande company, the Chinese real estate giant, and the reluctance of investors to risk.
Gold prices ignored the dollar’s gains, which usually put pressure on the precious metal.
By 8:35 (GMT), gold prices in spot trading increased by 12.67 dollars, or 0.73 percent, to trade at 1755.62 dollars an ounce.
Gold prices
US futures contracts rose by $5.85, or 0.33 percent, to $1,755.65 an ounce.
The rise in gold prices comes despite the dollar’s gains, which usually increase the cost of the precious metal to holders of other currencies.
The dollar index contracts, which measures the performance of the US currency against a basket of six major competing currencies, increased by 0.12 percent to 93.142 points.
Gold has benefited from being a safe haven, as investors are turning to value-preserving tools away from high-risk assets, waiting for the fate of the debt-ridden Evergrande to become clear.
On Thursday, the interest on two issues on Evergrande, which it said it would meet, accrued, but any holders of these bonds did not receive their dues until Friday morning.
Evergrande owes about 300 billion dollars, and it is feared that its crisis will spread to other markets, which heralds a series of collapses for major banks and companies around the world, similar to the mortgage crisis in the United States in 2008.
Yellow metal pressures
Gold faced pressure in the past two days as a result of the rise of the dollar, after indications issued by the Federal Reserve (the US central bank) that it would start slowing its broad program to buy bonds “soon”, followed by raising interest rates.
The effects of the US Federal Reserve’s hints on gold began to recede, with it not giving specific dates to start tightening its monetary policy, so that investors’ attention turned towards other factors, most notably the risks resulting from the Evergrande crisis.
Separately, until a few weeks ago, sales of three housing projects in the eastern Chinese city of Jinan were booming.
But this September, which has traditionally been one of the busiest months for new home purchases, the trend has been strained.
Sales in the projects are flat or declining as the authorities restrict access to mortgages. Developers are now offering discounts in an effort to sell condominiums, even if it results in a small loss.
