Gold price rallies 1 percent after explosions in Brussels

London (Mar 22)  Gold rallied more than 1 percent on Tuesday after two explosions at Brussels airport killed at least 13 people and a further blast hit the Belgian capital's Metro, with investors seeking assets seen as a haven from risk.
  Belgium's federal prosecutor said the airport explosions resulted from a suicide attack, public broadcasters VTM and RTBF reported. The Belga agency said shots were fired and there were
shouts in Arabic shortly before two blasts rang out.
 Spot gold rallied to a high of $1,259.60 an ounce in
the wake of the news, and was at $1,249.86 at 1030 GMT, up 0.5
percent. U.S. gold futures for April delivery were up
$6.40 an ounce at $1,250.60.
    Gold fell for three days to Monday on uncertainty over the
path of U.S. interest rates. Speculation rates would rise pushed
prices down 10 percent last year, but they have rebounded 20
percent since Jan. 1 as those expectations faded.
    "Before the explosions we had some fairly hawkish comments
from one of the Fed officials saying a rate increase could now
be on the agenda for April," Societe Generale analyst Robin Bhar
said.
    "I'd have thought that would have weakened gold, but clearly
safe-haven buying on the back of the explosions in Brussels has
(pushed prices higher)."
    Atlanta Federal Reserve President Dennis Lockhart said on
Monday the United States may be in line for a rate hike as soon
as next month, another sign that policymakers are comfortable
letting U.S. monetary policy diverge from other major economies.
    European stocks fell and investors rushed for the safety of
government bonds after the explosions in Brussels. The euro
fell, the yen and the Swiss franc rose, and the dollar index
climbed 0.3 percent after the news. 
    Swiss gold exports fell to an 18-month low in February as
shipments to leading gold consumers India, China and Hong Kong
slid from the previous month.
    "Exports to China, Hong Kong and India plunged by over 40
percent month-on-month and are thus nearly 30 percent lower than
in the same period last year. This points to subdued gold demand
in Asia," Commerzbank said in a note.
    Silver was up 0.7 percent at $15.89 an ounce,
platinum rose 0.1 percent to $980.70 an ounce and
palladium gained 0.3 percent at $598.70 an ounce.

Source: Reuters