Prices surge as U.S. and U.K. airstrikes in Yemen raise concerns

  • Gold futures rally on U.S. and U.K. airstrikes in Yemen
  • Prices turn higher for the week
  • Gold sees biggest daily gain since mid-December
  • Gold taking cues from weak U.S. and Chinese inflation data
  • Bond traders see inflationary pressures easing further in 2024

Gold futures rallied on Friday as U.S. and U.K. airstrikes in Yemen raised concerns about wider tensions and sparked risk aversion. Prices turned higher for the week, with gold seeing its biggest daily gain since mid-December. The rally was driven by weak U.S. and Chinese inflation data, as well as bond traders’ expectations of easing inflationary pressures in 2024. Despite the surge, gold remains vulnerable to a turnaround in sentiment, along with stocks and bonds. The next Federal Reserve meeting in January is expected to bring more volatility to gold and other rate-sensitive markets.

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Key People: Adrian Ash (Director of Research at BullionVault), Jim Wyckoff (Senior Analyst at Kitco.com)

Factuality Level: 6
Justification: The article provides information about the rally in gold futures due to U.S. and U.K. airstrikes in Yemen. It includes quotes from experts and data from FactSet. However, it also includes some tangential information about bond prices and inflation data that may not be directly related to the main topic.

Noise Level: 3
Justification: The article provides relevant information about the rally in gold futures due to U.S. and U.K. airstrikes in Yemen. It includes quotes from experts and data on gold prices. However, there is some repetitive information and the article diverges into unrelated topics such as Chinese inflation data and bond yields.

Financial Relevance: Yes
Financial Markets Impacted: Gold futures market

Presence of Extreme Event: Yes
Nature of Extreme Event: Political Upheaval or Revolution
Impact Rating of the Extreme Event: Minor
Justification: The article mentions U.S. and U.K. airstrikes in Yemen in response to Houthi rebel attacks on ships in the Red Sea. This raises the threat of wider tensions and potential major power conflict, which increases the appeal of gold as a safe-haven investment. However, the impact of the extreme event is considered minor as it does not involve significant casualties, injuries, or major economic disruptions.

Reported publicly: www.marketwatch.com