Germany’s finance minister, Wolfgang Schaeuble, ruled out a debt cut for Greece while it was still a member of the single currency bloc

Powered by article titled “Germany: Greece must implement reforms or leave the eurozone – as it happened” was written by Angela Monaghan (until 2.55) and Nick Fletcher, for on Thursday 9th February 2017 17.48 UTC

European markets close higher

A buoyant oil price and comments from President Trump about imminent tax announcements have helped outweigh the continuing political worries surrounding forthcoming French, Dutch and German elections, and the reappearance of the Greek crisis in the headlines. So with some help from an opening rise on Wall Street, European markets ended the day in positive territory. Chris Beauchamp, chief market analyst at IG, said:

The bounce in markets today reminds us that it is never wise to underestimate the strength of a bull market. It is also yet another incidence of that old adage, ‘never short a quiet market’. European markets have exploded into life, helped along by rosy results from Total and SocGen. With gold out of favour and dollar yen testing the waters above Y113 again, it could be that we are on the cusp of a fresh recovery in risk assets, just a day after the market seemed poised to fall heavily. A fresh all-time high in the S&P5 00 could be taken as proof that the rally is back on, but with a weekend looming traders may find it difficult to muster up much enthusiasm. Particular signs of strength are seen in US energy stocks, with the sector ETF up 1.1% today and 3% off the lows of the week. A turn in risk appetite needs the support of key sectors like this to be sustainable.

The final scores in Europe showed:

  • The FTSE 100 finished up 40.68 points or 0.57% at 7229.50
  • Germany’s Dax rose 0.86% to 11,642.86
  • France’s Cac climbed 1.25% to 4826.24
  • Italy’s FTSE MIB added 0.94% to 18,947.44
  • Spain’s Ibex ended up 1.17% at 9438.4
  • But in Greece, the Athens market dipped 0.34% to 608.79

On Wall Street, the Dow Jones Industrial Average is currently 121 points or 0.6% higher, around 20 points off the new all time high it reached earlier in the day.

On that note, it’s time to close for the day. Thanks for all your comments and we’ll be back tomorrow.


When it raised US interest rates in December the Federal Reserve suggested there could be three increases in 2017. But St Louis Fed president James Bullard – although a non-voting member at present – seems to disagree:


Meanwhile the Dow Jones Industrial Average has hit a new record high of 20,157.

The US markets have been buoyed by a rise in oil prices, and comments on a forthcoming “phenomenal” tax announcement and rolling back regulations from President Trump.


And Greece again, as IMF spokesman Gerry Rice says the fund is not asking for more austerity for the country:


Rice has also defended the IMF after the comments earlier from European bailout boss Klaus Regling:


Comments from President Trump that he will make an announcement about taxes in two to three weeks and continue to roll back regulations have given more support to the US stock market, with the Dow Jones Industrial Average now up 0.32%.


Delays could put Greek progress at risk – bailout fund boss Regling

Back with Greece and Klaus Regling, the managing director of bailout fund the European Stability Mechanism, has taken issue with the gloomy prognosis for the country given by the IMF. Writing in the Financial Times (£) he says:

For many, Greece remains synonymous with bad news. Few were surprised, therefore, when the International Monetary Fund recently stated that the country’s debt was on an alarming trajectory.

A sober look at the facts shows that Greece’s debt situation does not have to be cause for alarm. The European Financial Stability Facility and the European Stability Mechanism, the eurozone’s rescue funds, have disbursed €174bn to Greece. We would not have lent this amount if we did not think we would get our money back…

The solution for Greece lies not in additional debt relief, but in the government implementing reforms so as to avoid delays in the issuing of the next tranche of the ESM loan. Investors understand the ESM framework and recognise the commitments of Greece’s European partners. Past experience shows that making loans in exchange for reforms works. It is no coincidence that Ireland and Spain today have some of the highest growth rates in Europe and very low funding costs after successfully completing rescue loan programmes with demanding reforms.

In 2016, even Greece outperformed expectations, with a higher than anticipated growth rate and a primary surplus. Further delays could put this positive trend at risk.


US markets open higher

Over in the US and Wall Street is on the rise again, boosted by higher oil prices after Wednesday’s surprise fall in gasoline inventories.

The Dow Jones has added 0.22% or 45 points while the Nasdaq Composite has hit a new record high, up 0.27% at 5,698. The S&P 500 has added 0.21% and is just a point below its peak of 2,300 hit at the end of January.


An early chance to get the latest views of the new deputy governor of the Bank of England Charlotte Hogg comes courtesy of the University of Lincoln:

She will be at the university on 6 March, just days after her new appointment takes effect.

They probably need to send an updated tweet, though.


Kristin Forbes to leave Bank of England in June

As the chancellor announced the appointment of one female to a senior role at Threadneedle Street, the Bank revealed another was leaving.

Kristin Forbes
Kristin Forbes Photograph: Bloomberg/Bloomberg via Getty Images

Kristin Forbes, an external member of the rate-setting monetary policy committee, will leave the Bank on 30 June after a three-year term.

Forbes will return to her role as professor of management and global economics at the Massachusetts Institute of Technology this autumn. She was considered to be one of the most hawkish members of the MPC – in favour of tighter monetary policy – and voted against the decision of the majority of her colleagues to extend quantitative easing in August.

Mark Carney, the Bank’s governor, thanked Forbes for her contributions on the MPC:

She has brought insight, fresh thinking and academic rigour to our deliberations, as well as a fresh and engaging approach to communications. On behalf of colleagues at the Bank, I would like to wish her well as she returns to pursue her academic career at MIT on a full time basis.

Forbes said:

It has been an honour and a privilege to serve on the Monetary Policy Committee during these historic years. I will miss the insightful – and often intense – debates with my colleagues on the MPC, as well as the superb analysis and support of the staff.

I would like to thank the Treasury and Bank of England for welcoming someone from ‘across the pond’ for this important role, as well as MIT for restructuring my responsibilities to them so that I could prioritize this role in the United Kingdom over my term.


Bank of England
Bank of England Photograph: Alicia Canter/The Guardian

Want to know more about Charlotte Hogg, the Bank of England’s new deputy governor (from March)?

Fortunately my colleague Rupert Neate profiled her back in 2013.

In brief:

Name Charlotte Hogg

Born London 26 August 1970

Education St Mary’s Roman Catholic boarding school, Ascot. Studied economics and history at Hertford College, Oxford. Won a Kennedy scholarship to Harvard.

Parents Douglas and Sarah Hogg. Both had leading roles in Sir John Major’s government.

Career to date Joined the Bank of England as a graduate trainee. Became principal at management consultant McKinsey. Managing director, Morgan Stanley. Managing director, Experian UK and Ireland. Head of retail operations, Santander. Starts as chief operating officer at the Bank of England next month, effectively No 2 to the new governor, Mark Carney.

High point Winning the Aston-le-Walls horse trials on On a Par in 2010; securing the acquisition of the Goldfish credit card for Morgan Stanley in 2006.

What she says “You can have too much of a good thing in one family” (about not going into politics or law).

What they say “It was clearly a life of intense privilege. You could not image two better-connected people than her parents. They are the ultimate power couple” – family friend

“She is clearly an incredibly capable and intelligent woman, so this appointment is just deserts” – Dr Ruth Sealy, Cranfield School of Management

Read the full profile here:

Chancellor appoints Charlotte Hogg as Bank of England deputy governor

Charlotte Hogg
Charlotte Hogg Photograph: David Levene/The Guardian

Breaking: The Treasury has just announced that Charlotte Hogg will succeed Minouche Shafik as deputy governor of the Bank of England for markets and banking.

Hogg is currently the Bank’s chief operating officer. She will start the new role on 1 March for a renewable term of five years.

The chancellor, Philip Hammond, said:

I’m delighted to appoint Charlotte Hogg as the next Deputy Governor for Markets and Banking. I’m confident that her exceptional leadership skills and wide-ranging experience make her the right person to take on the position.

Charlotte has done an excellent job as the Bank’s first chief operating officer. She will take over this new role at a key time for the City.

I would like to thank Minouche Shafik for all her valuable work at the Bank, particularly on fair and effective markets. I wish her the best as she moves into her new role as Director of the London School of Economics.


On the jobless claims, Dennis de Jong, managing director at, said:

Donald Trump continues to place jobs at the heart of his successful run at the presidency, and he will breathe a sigh of relief at today’s downtick in initial jobless claims which are the lowest since November 2016.

Readings of sub-300,000 tend to indicate a healthy labour market, and we are currently enjoying an almost two-year stretch below that watershed – the longest since 1970.

However, these figures only tell part of the story, and while unemployment may be at historic lows, the challenge facing Trump now is to deliver substantive wage growth.

US jobless claims fall unexpectedly

Over in the US, and the number of workers filing for unemployment benefits showed a surprise decrease last week.

Jobless claims fell by 12,000 to a seasonally adjusted 234,000, compared to expectations of a rise to around 249,000. This is close to the 43-year low of 233,000 reached early last November. Claims have remained below 300,000 for 101 straight weeks, the best run since 1970.

US weekly jobless claims
US weekly jobless claims Photograph: US Dept of Labor

Meanwhile Greece’s labour minister Efi Achtsioglou has called the International Monetary Fund’s stance on the country’s bailout as “problematic” and its demands “unreasonable”, the Kathimerini newspaper is reporting:

Speaking after a visit to the Labor Inspection Corps in Alexandroulpoli, northern Greece, the minister who holds of the country’s stickiest portfolios said the IMF’s demand for the upfront legislation of measures to be passed if Greece fails to hit targets at the end of the bailout program is “economically unreasonable.”

The government’s aim, she said, is to wrap up the pending bailout review as soon as possible so that Greece can join the European Central Bank’s quantitative easing (QE) program and “consolidate the trend of improvement seen in the Greek economy this past year.”

“For our part, we have already implemented nearly 80 percent of the prior actions. Only labor reform is still pending precisely because of this disagreement,” Achtsioglou said.

Her priority, she said, “is to put a brake on the autocratic practices of employers, which have intensified recently, mainly as a result of the disintegration of the institutional framework of labor relations in the 2010-2014 period.”

The minister reiterated the government’s aim to reintroduce collective labor bargaining – something the country’s creditors are staunchly opposed to – arguing that this would “provide workers with a safety net and create the conditions for healthy competition between businesses.”

Blockades in Greece as farmers protest against austerity

More now from Greece, where farmers are stepping up protests over unpopular creditor-mandated austerity measures including higher taxes.

In a move that will put the Greek government under further pressure to bow to their demands, farmers and stockbreeders escalated their protests today blockading the customs post at Kristallopygi on the country’s border with Albania.

Describing the move as symbolic, Dimitris Moskos who sits on the committee representing farmers in the region, said the blockade would last 24 hours. At least 250 stockbreeders and farmers – many on tractors – were participating in the rally.

Launching nationwide protests two weeks ago, farmers vowed “to go all the way” in what some are calling an increasingly desperate attempt to lower tax rates, fuel prices and social security contributions.

Theodoros Papaconstantinou, also representing farmers in northern Greece, said:

There is no other way. People need to fight for their rights, for their social security and for decent prices for their agricultural products if they want to survive.

Tax rates for the sector are being doubled from 13% to 26% while pensions are being cuts by as much as 60% by 2022.

Farmers, who last week took similar action at the Greek-Macedonian border, have vowed to take their protests to Athens next, descending on the capital on Tuesday – Valentine’s Day.

It follows protests in Athens on Wednesday by Greek firefighters, who say a third of jobs are at risk because of hiring restrictions placed on the public sector by the terms of Greece’s international bailout.

Greek firefighters holding flares take part in a protest in central Athens, Greece, on 8 February 2017
Greek firefighters holding flares take part in a protest in central Athens, Greece, on 8 February 2017 Photograph: Yannis Kolesidis/EPA


Here is our full story on Twitter’s results:

Thomas Cook caves into shareholder pressure over pay

Thomas Cook has caved in to shareholder pressure and reduced the maximum payout under a long-term bonus plan for its chief executive, after a third of investors voted against the controversial plan.

Provisional results from the annual meeting showed just under 33% of the travel company’s shareholders opposed its plan to pay its boss Peter Fankhauser a bonus of up to 225% of base salary, worth about £1.6m a year. The firm has cut the maximum award to 165%, and said shareholders would be consulted before any payout.

Thomas Cook

The share price has fallen almost 8% in the past year as Thomas Cook, along with the rest of the travel industry, was hit by a spate of terror attacks in Turkey and elsewhere in Europe.

One retail investor spoke out against the “huge bonus” at the AGM in London. Addressing the board, Sunil Kumar Pal, who has held Thomas Cook shares for about 15 years, said: “On the one hand you say business is not going well and on the other hand you give such a huge bonus…at more than twice salary. You should review this policy.”

But another retail investor leapt to the company’s defence, thanking the management for the job it had done.

At last year’s AGM, Thomas Cook also suffered a shareholder revolt over executive pay with a quarter of investors voting against, and cut Fankhauser’s pay package to £1.2m from £4.3m.


Twitter shares slide on weak quarterly revenue growth

Twitter log
Twitter log Photograph: Twitter

Twitter shares have fallen 10% to .81 after the social media site reported its slowest quarterly revenue growth since going public.

Revenue rose just 1% to 7.2m, missing analysts’ expectations of 0.1m.

Jack Dorsey, chief executive:

While revenue growth conti nues to lag audience growth we are applying the same focused approach that drove audience growth to our revenue product portfolio.

This will take time, but we’re moving fast to show results.

Full story soon.


Market update: shares in Greece are down, but major markets elsewhere in Europe are up.

  • Greece’s ATG: -0.5% at 608
  • FTSE 100: +0.3% at 7,208
  • Germany’s DAX: +0.7% at 11,622
  • France’s CAC: +0.8% at 4,807
  • Italy’s FTSE MIB: +0.1% at 18,782
  • Spain’s IBEX: +0.6% at 9,385
  • Europe’s STOXX 600: +0.5% at 366

Connor Campbell, financial analyst at Spreadex, says US markets are likely to be similarly subdued:

Looking ahead to the US open and Thursday’s dreary trading is set to continue, with the Dow Jones promising a meagre 0.1% increase after the bell.

That keeps the Dow below 20,100, with only the jobless claims to spark any excitement as the afternoon gets underway.

Yanis Varoufakis
Yanis Varoufakis Photograph: Christopher Furlong/Getty Images

Yanis Varoufakis, the former Greek finance minister and nemesis of Schäuble, has given his latest view on the funding crisis engulfing his country.

Speaking to BBC Radio 4’s Today programme, he said everyday life in Greece was unsustainable, with the country’s European creditors going after “the little people”, rather than corrupt oligarchs.

The country has been put on a fiscal path which makes our everyday life unsustainable in Greece. The German finance minister agrees that no Greek government, however reformist it might be, can sustain the current debt obligations of Greece.

A country in desperate need of reform has been made unreformable by unsustainable macroeconomic policies. Instead of attacking the worst cases of corruption, for six years now the creditors have been after the little people, the small pharmacists, the very poor pensioners instead of going for the oligarchies.

We must come to terms with reality. The tragedy is that in 2010 a bankrupt country was given a huge loan, not to save it but in order to cynically transfer huge banking losses from the books of the Franco German banks onto the shoulders of the weakest taxpayers in Europe.

It’s like giving a credit card to a bankrupt entity in order to keep paying its debt, and then giving it another credit card and another. As long as you do that, Greece is unreformable and that is an indictment on the whole functioning of the eurozone

Schäuble: Greece must reform or leave the euro

Wolfgang Schäuble, Germany’s tough-talking finance minister, says Greece must leave the eurozone if it wants a debt cut.

Wolfgang Schäuble
Wolfgang Schäuble Photograph: Stephanie Lecocq/EPA

He told German broadcaster ARD that debt forgiveness would be in violation of European rules.

We can’t undertake a debt haircut for a member of the European single currency, it’s ruled out by the Lisbon Treaty. For that, Greece would have to exit the currency area.

The pressure on Greece to undertake reforms must be maintained so that it becomes competitive, otherwise they can’t remain.


Fitch: number of AAA rated countries lowest since 2003

The prestigious AAA credit rating is getting increasingly difficult to come by, according to Fitch.

The ratings agency said it has just 11 countries on the top tier rating, compared with a record high of 16 during the period between 2004 and 2009.

The financial crisis is to blame, of course.

Fitch said all its triple A sovereigns had a stable outlook, suggesting there would be no downgrades over the next 12 to 24 months.

The 11 countries which still make the grade:

  • Australia
  • Canada
  • Denmark
  • Germany
  • Luxembourg
  • Netherlands
  • Norway
  • Singapore
  • Sweden
  • Switzerland
  • US

James McCormack, global head of sovereign ratings at Fitch:

This is less than 10% of Fitch’s global sovereign portfolio, the smallest ever share for the rating category, and consistent with ‘AAA’ sovereigns now accounting for 40% of global government debt at end-2016, down from 48% a decade ago.

Japan was the first sovereign to be stripped of its AAA rating by Fitch in 1998, followed by another six in the aftermath of the global financial crisis over the seven years since 2009:

  • Austria
  • Finland
  • France
  • Ireland
  • Spain
  • UK

Greece braced for today’s ‘crucial’ Eurogroup Working Group

The Guardian’s Helena Smith says progress is essential at today’s Eurogroup Working Group* meeting, if a deal is to to struck on 20 February when the eurozone’s finance ministers next meet. She reports from Athens:

Greek officials are calling the Euro Working Group – scheduled for this afternoon – crucial.

As the latest Greek crisis plays out, today’s meeting has assumed a significance that few might have expected, even if some officials are saying a solution to breaking the deadlock of stalled negotiations can now only be found at a political level.

“What we are expecting today,” said one government source, “is for all the sides to open their cards to see if they really want an agreement or are still stuck to their positions.” The Greek government had shown it wanted to break the impasse but only “so far as it can go.”

European officials this morning were citied in the Greek media as saying almost no progress had been made since the last Eurogroup in January. Greece’s refusal to legislate fiscal measures up front – measures that would take effect when the country’s current bailout expires in 2018 – and the ongoing rift between creditor institutions over what exactly Athens should do were also cited as the greatest impediments to finding a solution.

If today’s EWG session fails to break the deadlock it is almost certain that auditors will be unable to return to continue the review next week which in turn will limit the prospects of any deal on 20 February when euro area finance ministers next meet.

*The Eurogroup Working Group is composed of representatives from eurozone countries who assist the Eurogroup (finance ministers) and its president (Jeroen Dijsselbloem) in preparing for ministers’ discussions. They meet once a month, ahead of Eurogroup meetings.


Greece would be better off outside the eurozone where its debts could be written off, according to a leading German politician.

Christian Lindner, leader of Germany’s Free Democratic Party, told the German radio station, Deutschlandfunk:

It’s clear that Greece needs to have its debts written off. Greece’s debts can only be written off outside of the eurozone, so we’re talking about Grexit.

Greece’s European creditors have so far refused to offer Greece debt relief, despite calls for them to do by the International Monetary Fund.

It’s not all about political uncertainty and market fears, sometimes it’s about bees and honey…

(FILES) This file photo taken on June 10, 2015 shows bees on a honeycomb in the Oblats Park in Nantes. Europe should expand a ban on bee-harming pesticides, environmental lobby group Greenpeace said January 12, as it released a report warning of widespread risks to agriculture and the environment. The report by biologists at the University of Sussex, commissioned by Greenpeace, concluded that the threat posed to bees by neonicotinoid pesticides was greater than perceived in 2013 when the European Union adopted a partial ban. / AFP PHOTO / GEORGES GOBETGEORGES GOBET/AFP/Getty Images

In the first UK trial of its kind, Tesco will ship discarded sugar from split bags in stores in Devon and Cornwall to a beekeepers’ group.

The sugar will be used to make a solution to feed Britain’s bees, struggling to get enough nectar to feed themselves.

Nick Bentham-Green, chairman of the Bee Improvement Programme for Cornwall said:

Recent poor summers have contributed to bees struggling to get enough stores into the hives to feed their colony throughout the winter. This new scheme is a great help, especially at this time of year, and is helping towards the conservation of the native British honey bee.

Full story here:

Thomas Cook braced for shareholder anger over pay

Ahead of Thomas Cook’s annual meeting in London at 10.30am, a shareholder group, Institutional Shareholder Services, has questioned the firm’s plans to pay Fankhauser a bonus of up to 225% of his base salary, amounting to up to £1.6m a year.

The “strategic share incentive plan” would pay out in five years’ time at the earliest and depends on several sets of performance targets.

The vote on this bonus plan will be binding. While the company does not expect to lose it, it could well get a bloody nose.

We’ve been here before. Last year, a quarter of shareholders voted against the group’s remuneration plans – so Thomas Cook cut the share award to Fankhauser to 165% of base salary, from a planned 200%.

It is worth noting that the standard share award at the company is 150% of base salary, but it has’t paid out in recent years because the firm’s performance hasn’t been great.


The fall in Thomas Cook’s share price (now down 9.7%) is the biggest one-day drop since late June in the aftermath of the Brexit vote.

Laith Khalaf, a senior analyst at Hargreaves Lansdown, said it was a challenging time:

Times are tough in the European travel industry and Thomas Cook isn’t having the best of it, though the good news is things don’t seem to be getting any worse.

Like-for-like revenues and losses were broadly flat on last year, which probably represents a small victory against such a competitive backdrop.

However there is little in its latest trading figures to suggest Thomas Cook is going to stave off a shareholder rebellion over its executive remuneration package, which looks to be brewing.

Greece will take some comfort from Thomas Cook’s comments this morning that bookings for holidays in the country are up more than 40%.

The travel company’s chief executive Peter Fankhauser said it had expanded its holiday offering to Greece and smaller destinations such as Cyprus, Croatia, Bulgaria and Portugal, which are also seeing double-digit growth.

He said: “We are catering for 500,000 more guests this year in Greece. We have more beds, more own-brand hotels, and 2 more flights going to Greece from the UK.”

Thomas Cook is shifting some capacity from Spain to Greece and will secure more beds in Greece if demand continues to rise, he added.

However, the company’s shares dropped 9%, even though it insisted it had a “solid start” to the year, as investors worried about the impact of terror attacks on travel to Turkey.

Like-for-like revenues in the three months to December edged up 1% to £1.6bn. Operating losses improved to £49m from £50m a year earlier.

Thomas Cook shares fall 9% after results

A Thomas Cook charter jet flies into the Greek island of Skiathos. Bookings to Greece are up 40%.
A Thomas Cook charter jet flies into the Greek island of Skiathos. Bookings to Greece are up 40%. Photograph: Terry Harris Just Greece Photo L/Alamy

Shares in Thomas Cook are down 9% this morning after the travel company published results for its first quarter.

Chief executive Peter Fankhauser said it was a “solid” performance for the first three months “against at backdrop of continued uncertainty.”

He added:

We remain cautious about the rest of the year, given the uncertain political and economic outlook.

It’s still relatively early in the selling cycle for summer holidays, but based on current trading, and supported by further financial benefits from implementing our strategy, we expect our full year operating results to be in line with current market expectations.

One of the most striking points was that bookings to Greece have jumped 40% compared with the same period last year. Thomas Cook is laying on more holidays to the country, as UK tourists stay away from Turkey and Egypt over safety concerns.

The company is also facing a potential pay revolt when shareholders vote at the company’s annual meeting later today. We will bring you updates.


FTSE edges higher

The FTSE 100 is slightly higher in early trading, up 13 points or 0.2% at 7,201.

After another closing high on Wednesday, the FTSE 250 is also up 0.2% at 18,635.

Major markets across Europe are also higher:

  • Germany’s DAX: +0.5% at 11,596
  • France’s CAC: +0.7% at 4,798
  • Italy’s FTSE MIB: +0.1% at 18,786
  • Spain’s IBEX: +0.3% at 9,360
  • Europe’s STOXX 600: +0.4% at 365

Political uncertainty has also kept equity investors guessing.

Michael Hewson, chief market analyst at CMC Markets, says that trying to work out which way markets are heading is like “wading through treacle”:

Equity markets in Europe have continued to chop in and out of positive territory for most of the past few days, as rising political uncertainty serves to keep investors in limbo, though the FTSE 250 has continued to outperform, closing at another record high yesterday.

So far this year equity markets across Europe for all the ups and downs seen in the last few weeks aren’t too far from where they started the year, as investors try to look through the fog of politics in France, Germany, the Netherlands, as well as the banking issues in Italy and the possibility of new elections there, as well as the perennial problem child of Greece. Is it any wonder that trying to find any sort of market direction is like wading through treacle?

US markets finished the day rather more mixed but only marginally below their record highs. US investors appear reluctant to throw in the towel on the Trump reflation trade quite yet, but there are signs of doubt as to whether it will actually arrive, so distracted does the new President appear to be with taking on his opponents.


The agenda: Political tensions fuel investor jitters

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Political tensions in Europe and the US are fuelling investor caution, with gold prices at three-month highs as demand for the safe have asset rises.

US gold futures rose 0.2% to ,241.30 an ounce, while spot gold hovers around ,240 an ounce.

Investors are concerned by the wave of elections coming up in Europe, not least in France where the far-right candidate Marine Le Pen – who is promising a referendum on EU memberhip – has gained strong support. In the US, uncertainty reigns over President’s Trump’s policies.

Barnabas Gan, analyst at OCBC Bank, says gold prices are likely to rise further over the next few weeks:

Gold prices will be a little bit rangebound with some upside bias for the next few weeks or so.

The risk factors have not really changed so far – we’re talking about Donald Trump, we’re talking about the political situation in Europe and because of all these factors, we do expect market watchers to stay cautious in the months ahead to gauge how the global economy is going to perform. © Guardian News & Media Limited 2010

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