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Gold Prices Climb Higher For Tenth Straight Session

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Gold Prices Climb Higher For Tenth Straight Session

Gold prices rose on Tuesday, extending gains to a tenth successive session as traders continued to seek the safe haven asset amid tensions in the Middle East.

Although traders are somewhat optimistic that the war of words between Washington and Teheran will not escalate into a full-fledged military conflict, the uncertainty on this front appears to be prompting traders to stay cautious with regard to riskier assets.

Markets were reacting to conflicting reports about American military repositioning troops in preparation for leaving Iraq.

There was some confusion earlier in the day after a letter surfaced showing that U.S.-led coalition troops would leave Iraq. The Pentagon later clarified that it was a mistake and “there has been no decision whatsoever to leave.”

A firm dollar limited the yellow metal’s uptick. The dollar index rose to 97.09 in late morning trades, and was last seen moving around 97.00, gaining nearly 0.35% from previous close.

Gold futures for February ended up $5.50, or about 0.4%, at $1,574.30 an ounce, the highest settlement since April 2013.

On Monday, gold futures for February ended up $16.40, or 1.1%, at $1,568.80 an ounce.

Silver futures for March ended up $0.214 at $18.393 an ounce, while Copper futures for March settled at $2.7935 per pound, gaining $0.0035 for the session.

In economic news, a report from the Commerce Department showed the U.S. trade deficit shrank to its smallest level in three years in the month of November.

The report said the trade deficit narrowed to $43.1 billion in November from a revised $46.9 billion in October. Economists had expected the deficit to narrow to $43.8 billion from the $47.2 billion originally reported for the previous month.

Exports climbed by 0.7% to $208.6 billion, while the value of imports slumped by 1% to $251.7 billion.

A separate report from the Institute for Supply Management showed service sector activity in the U.S. grew at a faster than expected pace in the month of December. The ISM said its non-manufacturing index climbed to 55.0 in December after dipping to 53.9 in November. Economists had expected the index to inch up to 54.5.

The material has been provided by InstaForex Company – www.instaforex.com