Investing.com - Gold futures added to overnight gains in North American trade on Monday, climbing to a five-week high as worries about a potential exit by the U.K. from the European Union left investors scrambling for safe haven assets.
Jitters ahead of Britain's June 23 referendum on European Union membership mounted after U.K. polls over the weekend suggested momentum for the campaign to leave the bloc is gaining momentum.
Gold for August delivery on the Comex division of the New York Mercantile Exchange rallied to a daily peak of $1,289.60 a troy ounce, the most since May 6. It last traded at $1,288.00 by 12:42GMT, or 8:42AM ET, up $12.10, or 0.95%.
Meanwhile, investors are looking ahead to the Federal Reserve’s policy meeting later this week. The U.S. central bank is not expected to take action on interest rates at the conclusion of its two day policy meeting on Wednesday.
The Fed will also release its latest forecasts for economic growth and interest rates. Fed Chair Janet Yellen is to hold what will be a closely-watched press conference 30 minutes after the release of the Fed's statement, as investors look for any change in tone about the economy or future rate hikes.
Traders all but ruled out a rate hike in June after U.S. employment data earlier this month showed the economy added just 38,000 jobs last month, the smallest increase since September 2010.
Market players are pricing in just a 2% chance for a rate hike this week and 23% for July, according to CME Group's (NASDAQ:CME) FedWatch tool. September odds were at about 37%.
Gold is up nearly 6% so far in June, after sliding more than 6% a month earlier, as market players reacted to shifting views on the timing of the next U.S. rate hike.
Prices of the precious metal have risen 20% so far this year amid skepticism over the Federal Reserve's ability to raise interest rates as much as it would like this year.
The yellow metal is sensitive to moves in U.S. interest rates. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Elsewhere on the Comex, silver futures for July delivery tacked on 6.5 cents, or 0.38%, to trade at $17.39 a troy ounce during morning hours in New York, while copper futures inched up 1.4 cents, or 0.66%, to $2.044 a pound.
Investors digested another round of Chinese economic data. Industrial production rose at an annualized rate of 6.0% in May, beating expectations for a 5.9% increase and holding steady from a gain of 6.8% in the preceding month, the General Administration of Customs said on Monday.
Fixed asset investment, which tracks construction activity, rose 9.6% last month, below forecasts for an increase of 10.5%.
The Asian nation is the world’s largest copper consumer, accounting for nearly 45% of world consumption.
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