Gold edges up as virus surge overshadows vaccine optimism

By Sumita Layek (Reuters) - Gold recovered from a more than 1% dip on Monday as investors weighed immediate concerns over rising coronavirus cases and bets on further economic support even as Moderna became the second drugmaker to declare effective vaccine test results.

Reuters November 17, 2020 00:06:12 IST
Gold edges up as virus surge overshadows vaccine optimism

Gold edges up as virus surge overshadows vaccine optimism

By Sumita Layek

(Reuters) - Gold recovered from a more than 1% dip on Monday as investors weighed immediate concerns over rising coronavirus cases and bets on further economic support even as Moderna became the second drugmaker to declare effective vaccine test results.

Spot gold rose 0.2% to $1,892.01 per ounce at 11:31 a.m. ET (1631 GMT). U.S. gold futures rose 0.3% to $1,891.60.

Bullion dropped as much as 1.3% after Moderna said its experimental vaccine was 94.5% effective, but this was less than the more than 5% slump after Pfizer last Monday announced its vaccine was over 90% effective.

"Vaccine is very very good news, but the problem is it's going to take quite a while to deploy it even in the developed countries," said Bart Melek, head of commodity strategies at TD Securities, adding the market had already adjusted positioning last week on the Pfizer news.

"Vaccine or no vaccine we're going to continue to have a hard time economically well into the third quarter of next year, we're going to need massive amounts of monetary stimulus and we're very likely to get fiscal stimulus, which ultimately should help move inflation closer to target."

Gold, considered a hedge against inflation and currency debasement, has gained over 24% this year, mainly benefiting from global stimulus measures to cushion the effect of the pandemic.

Coronavirus cases crossed the 11-million mark in the United States on Sunday.

While markets anticipate a return to normal in the second half of 2021, that "still leaves a massive gap in some of the economies globally that needs to be filled by governments and central banks", said Saxo Bank analyst Ole Hansen.

Investors are now awaiting U.S. Federal Reserve Vice Chair Richard Clarida's speech at 1900 GMT.

Silver eased 0.1% to $24.61 per ounce. Platinum rose 3.2% to $916.98, while palladium climbed 0.2% to $2,327.44.

(Reporting by Sumita Layek and Asha Sistla in Bengaluru; editing by Emelia Sithole-Matarise and Chris Reese)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.