Picture used for illustration. File
Gold prices rose to their highest in nearly eight years on Wednesday as a spike in coronavirus cases sparked concerns over the economic recovery from the pandemic and boosted demand for safe-havens.
Spot gold hit its highest since early October 2012 at $1,788.96 in early trade, and by 0958 GMT was at $1,787.31 per ounce, up 0.4%. U.S. gold futures were up 0.3% at $1,805.10 per ounce.
"Uncertainty about the coronavirus, particularly in the U.S, which could put the brakes on an economic recovery, and the ultra-loose monetary policy of central banks are giving support to gold," said Commerzbank analyst Daniel Briesemann.
A rise in negative-yielding global bonds was also adding to the metal's appeal, he said. Lower bond yields reduce the opportunity cost of holding non-interest bearing gold.
But with investment demand likely to be higher than jewellery consumption this year, especially with practically no physical demand in Asia, gold's price gains are "somewhat fragile", he added.
The United States recorded its biggest one-day spike in COVID-19 cases since the start of the pandemic on Tuesday, with the government's top infectious disease expert warning that infections could double.
U.S. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell pledged to continue to support the economy, which has been hammered by the pandemic.
Reflecting high investor demand, holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust , increased by 211.9 tonnes, or nearly 22%, in the second quarter.
"Technically the situation remains firmly bullish with investors betting on further (money) printing activity from central banks," said ActivTrades chief analyst Carlo Alberto De Casa.
Gold tends to benefit from widespread stimulus from central banks because it is widely considered a hedge against inflation and currency debasement. Palladium was down 0.6% at $1,918.72 per ounce, while platinum fell 0.4% to $813.21 per ounce and silver gained 1.5% to $18.39 per ounce.
Spot gold was down 0.3% at $1,734.31 per ounce by 03:45 GMT while US gold futures were also down 0.3% at $1,733.70 per ounce.
Spot gold was steady at $1,711.61 per ounce by 02:57 GMT while US gold futures dipped 0.3% to $1,710.20.
Spot gold rose 0.4% to $1,707.81 per ounce by 05:23 GMT while US gold futures climbed 0.4% to $1,704.90.
China’s new bank loans fell more than expected in April while money supply growth slowed to a 21-month low, as the central bank gradually scales back pandemic-driven stimulus to reduce debt and financial risks in hot areas of the economy. The world’s second-largest
Toyota Motor Corp forecast its profit would bounce back to pre-pandemic levels this year, as the world’s biggest automaker exuded confidence it can tackle a global chip shortage that has stung its rivals. Japan’s top automaker, which has been stockpiling the
The Danish Government has confirmed its official participation in Expo 2020 Dubai, partnering the Danish Business Council at the six-month global gathering. Reem Bint Ibrahim Al Hashemy, Minister of State for International Cooperation, and Director General
Oil prices rose on Wednesday after a drop in US crude inventories reinforced Opec’s robust demand outlook, while the market awaited fresh updates on the Colonial Pipeline outage. US West Texas Intermediate (WTI) crude futures rose 29 cents, or 0.44%, to $65.57