SINGAPORE – Worries about the unpredictability of the Donald Trump presidency are revitalising gold. Bullion is trading at the highest level since the week in November when Trump won the US election as rising global tensions surrounding Syria and North Korea strain investors’ nerves.

A standoff between the US and Russia after an American missile strike on Syria and Trump’s pledge to solve the North Korean “problem” with or without China have deepened concerns about political stability, and there are also signs that Russia and the US are increasingly at odds over Afghanistan.

“When you put that mix together: Syria, Trump, North Korea, it’s a volatile thing,” Jonathan Barratt, chief investment officer at Ayers Alliance Securities in Sydney, said in an interview on Bloomberg Television Wednesday. “It’s that uncertainty that people are concerned about.”

Gold slumped after Trump’s election on his promises of tax cuts and more infrastructure spending, but since mid-December prices have rebounded about 14% partly on worries about the unpredictability of his presidency. On Wednesday, bullion rose to $1 279.85 an ounce, the highest since November 10, before trading at $1 275 by 2:15 p.m. in Singapore, according to Bloomberg generic pricing.

Trump said he launched the missile strike because of evidence Syria was behind a chemical attack on civilians, and the US has accused Russia of trying to cover up for its ally by spreading disinformation. The US has moved a naval battle group closer to North Korea amid fears it may conduct a nuclear or missile test around the time of the April 15 birthday of founder Kim Il Sung.

ESCALATION POSSIBLE
Russia must withdraw support from Syrian President Bashar al-Assad’s regime if it wants an “important role” in talks about Syria’s future, US Secretary of State Rex Tillerson told reporters on Tuesday in Italy, where he was attending a meeting of foreign ministers from the Group of Seven nations. The US-Russia relationship will be closely monitored as Tillerson visits Moscow Wednesday.

“With geopolitical tensions, if anything ratcheting higher, this will likely remain the theme running into the long weekend,” Jeffrey Halley, senior market analyst at Oanda Corp. in Singapore, said by email. Markets in the US, Europe and parts of Asia-Pacific are closed Friday for a public holiday.

The initial target for gold is around the $1 307 level, but there needs to be a considerable worsening in the situation to push on past that mark, Halley said. “A serious escalation could see gold to the $1 380 to $1 400 area tout suite, but it would have to be really serious,” he added.

In terms of Afghanistan, US Defense Secretary James Mattis has voiced alarm at Russia’s actions in the country amid allegations that it’s been cultivating links with the Taliban, which has waged a campaign against Afghan and NATO forces. The Kremlin denies arming the group.