Gold Set for Longest Winning Run in 2 Months on Obama Win

Gold gained for a third day in New York, heading for the longest winning streak in more than two months, on expectations the U.S. will keep stimulus measures to boost the economy after President Barack Obama won re-election.

Obama defeated Republican Mitt Romney, becoming only the second Democrat since Franklin Roosevelt to win another term. The Fed said Oct. 24 it will maintain $40 billion in monthly purchases of mortgage debt and probably hold interest rates near zero until mid-2015. The U.S. dollar weakened as much as 0.4 percent against a six-currency basket. Bullion usually moves inversely to the greenback.

Bullion advanced 10 percent this year and is set for a 12th annual gain after central banks took steps to stimulate economies hurt by Europe’s debt crisis. Photographer: Chris Ratcliffe/Bloomberg

“Obama’s victory gives confidence that the Fed’s quantitative easing will continue unhindered,” said Bjarne Schieldrop, the Oslo-based head of commodity research at SEB AB.

Gold for December delivery rose 0.6 percent to $1,724.90 an ounce by 6:51 a.m. on the Comex in New York. It rallied as much as 1 percent to $1,733 an ounce, the highest price since Oct. 19. Gold for immediate delivery gained 0.5 percent to $1,725.10 an ounce in London.

Gold futures climbed 1.9 percent yesterday, the most since Sept. 13. They jumped 4.2 percent on Nov. 4, 2008, the day Obama was elected for his first term, and more than doubled during the four years of his presidency.

“Gold could not have asked for a better outcome,” Edel Tully, an analyst at UBS AG in London, said in a report today. “Now it’s up to buyers to step up to the plate.”

Bullion advanced 10 percent this year and is set for a 12th annual gain after central banks took steps to stimulate economies hurt by Europe’s debt crisis.
Fiscal Cliff

Obama will need to address a so-called fiscal cliff of more than $600 billion in tax increases and spending cuts that take effect in January unless Congress reaches a budget compromise.

Gold rose to $1,730.50 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,691 yesterday afternoon.

Silver for December delivery added 0.3 percent to $32.13 an ounce after a 2.9 percent jump yesterday. Platinum for January delivery increased 0.3 percent to $1,563.10 an ounce and palladium for December delivery fell 0.5 percent to $617.35 an ounce.

Bloomberg