Gold Set To Extend Weekly Fall On Stimulus Worries, Vaccine Optimism
Gold prices were set for a second straight weekly fall on Friday as the metal's appeal came under pressure from promising COVID19 vaccine trials and news of the U.S. Treasury ending emergency loan programs.
- Last Updated: November 20, 2020, 12:27 IST
- FOLLOW US ON:
Gold prices were set for a second straight weekly fall on Friday as the metal’s appeal came under pressure from promising COVID-19 vaccine trials and news of the U.S. Treasury ending emergency loan programs.
Spot gold dipped 0.1% to $1,866.28 per ounce by 0611 GMT and was down 1.1% for the week.
U.S. gold futures were up 0.3% at $1,867.90.
In a letter to U.S. Federal Reserve Chair Jerome Powell, U.S. Treasury Secretary Steven Mnuchin said the $455 billion allocated to Treasury under the CARES Act should be instead available for Congress to reallocate. Global equities on Friday slipped following his comments.
“If the Fed does start shrinking its assistance programme that could be a bit of headwind for gold again… The monetary debasement argument that has supported gold could weaken,” said Lachlan Shaw, National Australia Bank’s head of commodity research.
Gold, considered a hedge against inflation and currency debasement, has gained 23% this year, benefiting mainly from unprecedented stimulus measures unveiled to cushion the pandemic impact.
“It’s going to be a huge bumpy ride (for gold) waiting for stimulus to come in,” said Stephen Innes, chief global market strategist at financial services firm Axi. “It is now looking at $1,900 into year-end.”
Meanwhile, data from AstraZeneca and Oxford University showed their potential COVID-19 vaccine produced a strong immune response in older adults, allaying some concerns fuelled by the intensifying pandemic.
Silver rose 0.1% to $24.12 per ounce. Platinum and palladium gained 0.4% to $955.09 and $2,333.69, respectively.
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor