Coronavirus COVID-19: Gold falls on profit-booking, virus-led economic fears limit losses

Gold edged down on Monday as buyers booked earnings after costs hit a one-month excessive final week, whereas worries over a coronavirus-driven steeper international economic downturn and the US Federal Reserve`s stimulus measures restricted bullion`s losses.

Spot gold slipped 0.4% to $1,681.49 per ounce by 0239 GMT. US gold futures fell 1.4% to $1,728.40.

There is “a bit of a post-weekend profit-taking. (There is) no follow through topside as equity markets are trading more neutral and the dollar remains relatively firm,” mentioned Stephen Innes, chief market strategist at monetary providers agency AxiCorp.

Commodity currencies slipped towards safe-haven items such because the greenback and yen as a file output reduce agreed by main oil producing nations didn’t offset broader considerations about international demand for sources, whereas world shares fell as buyers braced for extra economic damages from the novel coronavirus pandemic.

Gold costs rose to their highest since March 9 on Friday, lifted by bleak U.S. weekly jobless claims numbers, which underscored the deeper economic influence from the pandemic.

In a bid to maintain the economic system afloat amid the outbreak, which had pressured 16.eight million Americans to file for unemployment advantages for the reason that week ended March 21, the Fed on Thursday introduced a broad, $2.Three trillion stimulus package deal.

“The Fed stimulus is a magnet for gold. Not only does it improve the opportunity cost for holding gold but at some stage it will eventually water down the dollar,” Axicorp`s Innes mentioned.

European Union finance ministers additionally agreed on half-a-trillion euros value of economic assist however left open the query of tips on how to finance restoration within the bloc headed for a steep recession.

Meanwhile, main bodily bullion hubs noticed exercise dwindle final week because of coronavirus-led restrictions, with strained provide chains reduce off from hovering safe-haven demand in some areas.

Reflecting urge for food for bullion, holdings in SPDR Gold Trust, the world`s largest gold-backed exchange-traded fund, rose 0.6% to 994.19 tonnes on Thursday.

Palladium rose 3.3% to $2,243.26 per ounce, whereas platinum slipped 1.2% to $739.15 and silver eased 0.5% to $15.24.

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