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Gold soared by the most since Britain’s Brexit vote in June as the prospect of Donald Trump as the next U.S. President reverberated through global markets, prompting a rush to havens and a flight from risky assets.
Bullion jumped as much as 4.8 percent to $1,337.38 an ounce, the biggest intraday increase since June, and traded at $1,319.99 by 6:50 a.m. in London, according to Bloomberg generic pricing. The advance sent prices to the highest level since September and spurred gains in gold mining shares.
Volume on the Comex was double the daily average, according to bourse data compiled by Bloomberg.
Investors are fleeing risky assets as Trump is poised to enter the White House after winning a string of battleground states. Before the vote, most polls showed Hillary Clinton ahead, so the reversal forced investors to adjust positions. The real estate magnate is seen as a riskier bet than his rival after he advocated ripping up trade deals and building a wall on the Mexican border.
A Trump victory could send bullion to $1,395, according to more than 20 analysts and traders surveyed by Bloomberg before the vote. A gauge of price swings over the past 15 days has rebounded from a two-year low.
"The economic uncertainly this brings has seen a flight to safe haven assets and seen a significant sell off across Asian equity markets," said Cameron Alexander, an analyst with Thomson Reuters-owned metals consultancy GFMS.
Reference: Bloomberg, Reuters
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