· Gold prices firmed above the key $1,800 level on Tuesday, underpinned by concerns over mounting coronavirus cases globally as many regions reintroduced curbs to restrict the outbreak.
· Spot gold gained 0.4% to $1,809.83 per ounce. U.S. gold futures settled mostly unchanged at $1,813.40.
· “There’s an anticipation of more widespread shutdowns which is drawing people back to gold to hedge against the uncertainty,” said Jeffrey Sica, founder of Circle Squared Alternative Investments.
“There’s going to be a high likelihood that we’ll see the U.S. Federal Reserve not only continue with the economic stimulus programmes, but in some cases accelerate them so that helps gold prices significantly.”
· Many parts of Asia are finding cause to pause the reopening of their economies as a jump in virus cases fans fears of a second wave, while California clamped new restrictions on businesses as infections soared.
· The World Health Organization on Monday warned the pandemic would only get worse if countries failed to adhere to strict precautions.
· Gold prices have risen over 19% so far this year, mainly benefiting from lower interest rates and widespread stimulus measures from major central banks as it is widely viewed as a hedge against inflation and currency debasement.
· The dollar fell as the euro rose on optimism about the possibility of a European Union stimulus package.
· Investors kept an eye on a growing U.S.-China rift over the South China Sea region, with Beijing’s announcement that it will slap sanctions on Lockheed Martin for involvement in the latest U.S. arms sale to Chinese-claimed Taiwan.
· Reflecting investor appetite, holdings of SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, rose 2.92 tonnes to 1,206.89 tonnes on Monday.
· Elsewhere, palladium eased 0.7% to $1,966.50 an ounce and platinum edged down 0.3% to $826.05.
· Silver gained 0.4% to $19.16, after hitting its highest since September 2019 on Monday.
Reference: CNBC
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