Gold prices rose during Wednesday’s trading, to record near
its highest level in 7 years with losses of U.S. shares as a result of Apple's warnings
and amid concerns about the negative repercussions of the coronavirus.
As
of 08:17 GMT, spot gold hovered around $1,607.05 an ounce, which considered the
second highest level this year and close to the highest level since March 2013,
where the precious metal extended its gains after the breakout of resistance at
$1588.
Gold's
gains came after the notable losses incurred on Wall Street last night, as the
Dow Jones lost 0.56 percent and the S&P 500 dipped 0.29 percent,
while the Nasdaq Composite soared 0.016 percent.
Investors' desire to acquire safe haven assets was
renewed after Apple confirmed that it was unlikely to meet its sales target
within the first 3 months of this year, due to the impact of the Coronavirus on
production and demand in China.
Gold is considered a classic safe haven in times of
crisis or economic, political and geopolitical uncertainty, and therefore it
managed to resume its advance from $1547.50 hit on February 5.
In terms of corona developments, the Chinese
government has confirmed more than 72,400 infected cases and 1,868 deaths in
China to date.
The gains of the yellow metal came despite the rise in
the dollar to the highest level in 5 months, noting that the green currency is
also treated as a refuge asset.
Meanwhile, the dollar index, which measures the
performance of major six currencies against the US dollar, slumped by 0.02
percent at 99.31 after touching its highest level since September 2019.
Later in the day, the U.S. will release its producer
prices and housing data, yet the key focus will be on the FOMC minutes, which provides
in-depth insights into the conditions that influenced policymakers’ vote on interest
rates.
As for other precious
metals, palladium jumped 7 percent to trade above $2,820 an ounce after hitting
a new record high at $2,843.50. Platinum added 1.75 percent to $1,009 an ounce,
the highest since January 24 and spot silver edged up 1 percent to $18.35 an
ounce.
