Gold prices were back up $1,300 in the morning hours on October 16. It marks the first time the yellow metal has surpassed that key mark since early and mid-September.
The U.S. Consumer Price Index came in slightly less than expected at 0.5% compared to 0.6% expected. The International Monetary Fund was optimistic about the global economy in the past week and one more rate hike is expected from the U.S. Federal Reserve. Representatives from the IMF have continued to warn about high debt levels and the risk of financial shocks as this credit cycle winds down.
As far as the geopolitical situation is concerned, tensions with North Korea remain high. A rift has developed between President Trump and U.S. Secretary of State Rex Tillerson. The President also opted to decertify the Iran nuclear deal, which could lead to its dissolution in a few months. If this happens, Middle East tensions will undoubtedly increase.
The iShares S&P TSX Global Gold Index Fund (TSX:XGD) was down 0.47% at the top of the noon hour on October 16. Shares of the ETF have increased 3.8% in 2017 and are down 2.1% year over year. As we head into the final months of 2017 gold will remain a safe haven while international tensions ramp up but increasing global growth and a higher U.S. dollar will likely apply downward pressure.
In any case, this ETF provides a solid option for investors who want exposure to the top gold equities that Canada has to offer.