Gold rises above $1,300 per ounce as US election polls and the coming Fed rate decision spooks investors

 
Billy Bambrough
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Gold prices are up over two per cent since the FBI said it was re-opening its investigation in to Hillary Clinton's emails
Gold prices are up over two per cent since the FBI said it was re-opening its investigation in to Hillary Clinton's emails (Source: Getty)

Gold prices have hit a one month-high today.

Prices topped $1,300 per ounce on the growing uncertainty surrounding the US presidential election and a last-minute rush to safe havens ahead of Fed chair Janet Yellen's interest rate announcement at 6pm London time today.

With less than one week to go before the US election and polls tightening, analysts said the increased appetite for gold was down to the mounting possibility of a Trump presidency.

Read more: Here's what will happen to the US economy if Donald Trump is elected

Gold prices are now up over 2.2 per cent since FBI director James Comey announced it had reopened its investigation in to Hillary Clinton's emails on Friday.

Investors are thought to be bailing out of riskier assets following an ABC News/Washington Post tracking poll that showed Republican candidate Donald Trump ahead of rival Hillary Clinton for the first time in months.

Naeem Aslam, chief market analyst at Think Markets, said:

What is overshadowing the markets right now is a surprise news that Trump has lead in the polls once again and this race for the presidency is going to be tight.

Investors have abandoned the ship when it comes to the equity market and it is more about the safe haven trade. Hence we are seeing the volatility index moving higher and the precious metal.

Markets were also awaiting the latest US interest rate decision following a two-day Federal Reserve policy meeting.

Read more: Nigel Farage thinks US polls could be out of whack, just like they were for Brexit

The meeting is not expected to deliver any change in policy, with December being pencilled in for the Fed's second hike since the 2008 financial crisis.

Fawad Razaqzada, market analyst at Forex.com added:

The $1300/08 area for gold represents a major technical resistance zone. Previously, dips were bought here; now rips could be sold here.

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