Fundamental Comment

Gold retreats as global stimulus hopes damp haven demand

Gold retreats as global stimulus hopes damp haven demand

Gold fell during Tuesday’s trading after reaching its highest level since December 2012 during the previous session, as speculations of stimulus measures by global central banks and governments to combat Covid-19 boosted investor confidence.

As of 07:49 GMT, spot gold hovered around $1,662.45 an ounce, where the precious metal hit the highest level since December 2012 at $1704.30 during yesterday’s trading session, while the lowest level was recorded during today’s session was at 1,649.40.

The decline in precious metals was the result of higher confidence among investors amid hopes of stimulus measures by central banks around the world to contain the economic effects of the coronavirus on the global economy.

US President Donald Trump has said that he will take "major" steps to prepare his country's economy to counter the impact of the Corona outbreak.

On the other hand, Japan's economy minister said his country would not hesitate to take the necessary and appropriate measures to counter the major impact on the economy from the spread of the virus.

An official at the Japanese finance ministry said there was a connection between Japan and the Trump administration, as they work together on an economic package.

Regarding Coronavirus latest updates, more than 4,000 people worldwide, including China, have died of Covid-19 infections, while Italy is approaching 10,000 infections, prompting the government put the whole country under a lockdown.

Italy's prime minister called on people across the country not to leave the house except for work or in an emergency, noting that all public gatherings are banned and sports events suspended.

As for other precious metals, silver rose 0.32 percent to $17.10 an ounce, to recover from losses incurred over the past session.

Palladium descended by 0.43 percent to trade at $2,395.35 an ounce, while platinum went in the opposite direction by increasing about 1.29 percent at $873.95.

The dollar index, which tracks the performance of the U.S. currency against a basket of six major currencies, advanced 0.72 percent at 95.54, recovering from yesterday’s tumble when it fell to its lowest level since October 2018.

Share Article