Gold
prices rose during Wednesday trading, as demand for safe havens increased, amid
doubts about the effectiveness of the Corona vaccine, as well as gloomy data from
major economies.
As
of 12:25 GMT, spot gold hovered around $1,750 an ounce, where the precious
metal touched its highest level during the session at $1,753.36.
The
precious metal benefited from a shift in investor sentiment from hazardous
assets to safe havens on the back of doubts about the effectiveness of a new
vaccine recently announced.
Vaccine
experts have questioned the effectiveness of Moderna's announcement on Monday
that its potential Vaccine Covid-19 has generated an immune response in all 45
phase I participants, arguing that there is not enough evidence to support the
claims.
As
for economic data, UK and euro area inflation figures released today showed a
sharp fall in the year ended April, as the coronavirus measures hit economic
activity.
On
the other hand, the possibility of seeing more monetary measures by the Federal
Reserve pushed the dollar lower and boosted demand on the precious metal as an
alternative investment.
During
his testimony before the U.S. Senate Banking Committee, Federal Reserve
Chairman Jerome Powell said the Fed is looking to expand access to credit facilities
for additional borrowers, including slower-sized States.
Powell
reiterated his remarks since the end of April, saying: "This is the time
to use the great financial power of the United States. We're all in front of
us, the amount that has been disbursed so far, in the context of the American
economy, is fairly modest."
He
also stressed that the Fed was "committed to using our full range of tools
to support the economy at this difficult time even as we recognize that these
actions are only part of a broader public sector response."
Markets
are closely awaiting the minutes of the FOMC's monetary policy meeting on April
28-29, later in the day.
The
US central bank has kept interest rates close to zero and injected significant
stimulus to support the economy affected by the Corona pandemic.
Meanwhile, the dollar
index, which measures the performance of six major currencies against the US
dollar, dropped for a third straight session to 99.29.
