Threat of government shutdown pushes gold higher

Gold prices enjoyed some appreciation on September 30, pushing higher as individuals who purchase precious metals responded to concerns that the U.S. federal government could potentially shut down.

By 10:48 GMT, spot gold was trading at $1,335.99 an ounce, extending the robust gains that the contract enjoyed during the prior session, according to Reuters. Since July, the metal has surged 8.3 percent. However, several market experts have noted that this sharp gain happened after the metal suffered a rather significant drop earlier this year.

“I wouldn’t say it was a strong quarter because the base was quite low after a record plunge in the second quarter,” Commerzbank analyst Carsten Fritsch told the news source.

The metal fell into a bear market in April, having lost 20 percent of its value since its recent high. Gold then extended these losses and reached a low in June, falling below $1,200 per ounce. Then, the fortunes of the metal seemed to improve, as it managed to stage a strong recovery and then move into a bull market in August.

Gold has obtained additional support recently, as the U.S. House of Representatives has put the federal government in a bind by approving a measure that requires a one-year delay in implementing President Barack Obama’s landmark health care reform law in exchange for continued budgetary funding, according to the media outlet.

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