Gold Prices May Shrug Off US CPI Data as Risk Appetite Collapses

Corporate Earnings Chart August 10

His comments came in response to North Korea's threat to fire ballistic missiles toward the US territory of Guam, which is home to USA strategic bombers, a naval station and other strategic assets.

With Japanese markets closed for a public holiday, Hong Kong led the downward charge in Asia-Pacific as the Hang Seng lost more than two percent.

"The tension between the USA and North Korea is still dominating the news and it is looming over the financial markets", said David Madden, market analyst at CMC Markets UK.

That prompted North Korea to say it was considering firing missiles near Guam, a US Pacific island territory.

Aug 11 (Reuters) - U.S. stocks indexes were higher in afternoon trading on Friday, on track to snap a three-day losing streak, as tepid inflation data brought back investors to riskier assets, despite heightened tensions between the United States and North Korea.

The yen tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation and there is an assumption that Japanese investors will repatriate funds should a crisis materialize.

Gold rose to its highest level in nearly two months, while the Swiss franc increased by more than 1% against the USA dollar and saw its biggest one-day gain against the euro in more than two and a half years.

In forex trading, the dollar fetched 109.99 yen, almost flat from 110.02 yen in NY but up slightly from 109.74 yen in Tokyo Wednesday.


Disappointing earnings also helped pull the market lower Wednesday.

Bond prices rose. The yield on the 10-year Treasury note slipped to 2.25 percent from 2.26 percent late Tuesday. The euro fell to $1.1735 from $1.1752.

"With concerns over stubbornly low inflation weighing heavily on the prospect of another US interest rate increase, the pending US CPI data will be in sharp focus".

Gold rose 0.6% to $1,268 (£976) an ounce and platinum gained 0.6% to reach $972.95 an ounce, having hit its highest since April at $979. Brent crude, used to price global oils, rose 20 cents to $52.10 a barrel in London. Since the beginning of 2017, the barometer index of the S&P 500 had only two sessions of declines of 1 % or more.

Japanese, British and USA 10-year government bond yields are also at or close to their lowest level since late June.

According to the figures published by the US Bureau of labor Statistics on Thursday, US PPI decreased by 0.1% in July month-on-month, driven mainly by declining energy and services prices.

Later on Friday, the USA will release inflation data for the month of July.

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