Spot gold was up 0.2% at $1,715.25 per ounce by 0949 GMT. U.S. gold futures rose 1% to $1,730.60 per ounce.
“Massive monetary support we are witnessing at the movement is helping gold. Despite higher risk appetite, the gold prices until now stayed above $1,700 per ounce, although it did come under pressure because of higher equity markets,” Commerzbank analyst Eugen Weinberg mentioned.
“The U.S. Federal Reserve left interest rates unchanged and it should stay there for sometime. Going forward, the unprecedented monetary stimulus provided by the ECB and the Fed is likely to increase demand for gold.”
On Wednesday, the Fed saved rates of interest close to zero and promised to increase emergency programmes as wanted to assist the battered financial system.
The U.S. financial system contracted in the primary quarter at its sharpest tempo for the reason that Great Recession, whereas economists count on a good sharper contraction in the second quarter.
Focus now shifts to the ECB coverage choice, attributable to be launched at 1145 GMT. The central financial institution is beneath stress to deploy much more firepower to prop up an financial system that might shrink by a tenth this yr.
Bullion has risen greater than 9% to this point this month, boosted by a wave of stimulus measures from central banks to restrict financial harm from the coronavirus-outbreak.
Lower rates of interest scale back the chance price of holding non-yielding gold, which additionally tends to learn from widespread stimulus measures as it’s usually seen as a hedge towards inflation and foreign money debasement.
“Investors remain confident about a relatively quick solution to coronavirus, although it is now abundantly clear that central banks will be forced to print a large amount of money,” ActivTrades chief analyst Carlo Alberto De Casa mentioned in a notice.
“From a technical point of view, a clear climb above the resistance placed at $1,730-$1,735, which has already been tested twice earlier this month, will create space for further rallies in gold.”
However, constructive trial outcomes for a drug to deal with the coronavirus boosted urge for food for riskier property, limiting gold`s advance.
Elsewhere, palladium climbed 2.7% to $1,987.87 an oz., platinum gained 0.5% to $778.16. Silver edged 0.1% larger to $15.38 per ounce.