Safe-haven interest in the precious metal and a softer dollar has boosted local gold miners, with the rand also slightly weaker on Wednesday morning. The JSE’s gold index pushed past 1,700 points for the first time in nearly six years on Wednesday morning, as the gold price continued to benefit from a weaker dollar and interest in safe-haven assets.
Gold is at a ten-month high, boosted in overnight trade on Tuesday, after reports that the US was putting pressure on China to rein in alleged currency manipulation.
At 11am the JSE’s gold index was up 6.4% to 1,714 points. Gains were led by AngloGold Ashanti, which had risen 8.77% to R216.22. Gold Fields was up 4.7% to R58.77, and Harmony 4.48% to R30.30. Gold was flat at $1,342.22/oz, while the rand was 0.6% weaker at R14.1274/$.
The issue of currency devaluation has long been a complaint of the administration of US President Donald Trump, said Oanda analyst Craig Erlam. Gold also continued to benefit from signs of continued monetary policy stimulus from global central banks, Erlam said. This was because gold is seen as a hedge against inflation and therefore loose monetary policy.