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Tuesday, June 02, 2020

Gold slides on hopes of recovery in economic growth

Spot gold slid 0.7% to $1,737.09 per ounce by 0744 GMT. US gold futures slipped 0.8% to $1,738.40.

By: Reuters | Published: May 21, 2020 1:48:17 pm
PRECIOUS - Gold falls on profit-booking, virus-led economic fears cap losses, Commodity currencies slip against the dollar and yen, 16.8 million US jobless claims since week ended March 21, gold prices news, bullion prices news, commodity market news, business news india, indian express business news Five hundred gram gold bars, produced by Swiss manufacturer Argor Hebaeus SA, sit in a storage tray in this arranged photograph at Aranypiac Kft in Budapest, Hungary, on Wednesday, July 20, 2016. Photographer: Akos Stiller/Bloomberg

Gold fell on Thursday on hopes of a swift recovery in growth following easing of lockdowns and possibility of a coronavirus vaccine, but bleak data from major economies limited losses.

Spot gold slid 0.7% to $1,737.09 per ounce by 0744 GMT. US gold futures slipped 0.8% to $1,738.40.

Global equities surged overnight, though gains during Asian hours were limited by lingering caution about the long-term impact of the coronavirus outbreak.

“There is still some optimism and risk-on sentiment about the possibility of a vaccine and talks of lockdown easing and growth slowly picking up,” said National Australia Bank economist John Sharma.

“But it not a huge thing and if it was major, we would see gold going below $1,700.”

Gold rallied to its highest since October 2012 on Monday, driven by economic damage concerns, US-China tensions and massive monetary and fiscal stimulus.

US Federal Reserve policymakers acknowledged the possibility of further support measures if the economic downturn persists, the minutes from the latest policy meeting showed.

The latest round of dismal economic indicators have underscored the extent of damage inflicted by the virus, with data showing Britain’s inflation slumped to its lowest since 2016.

The initial US jobless claims data due later in the day will be the next focus for further clues about the health of the world’s top economy.

Palladium dropped 1.4% to $2,071.81 an ounce, after hitting a one-month high on Wednesday. Platinum fell 0.9% to $842.78.

ANZ analysts expect weaker auto sales to be the key downside risk for the platinum group metals this year and see demand contracting for both palladium and platinum.

“Mine supply disruptions could protect the downside; still we see prices staying volatile amid the ongoing macroeconomic challenges,” they said.

Silver declined 1.6% to $17.23 an ounce.

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