Gold prices ease from 4-week high as dollar, equities strengthen on signs of coronavirus slowdown

India’s gold imports plunged more than 73 percent year-on-year in March to their lowest in 6-1/2 years as record domestic prices and a lockdown to curb the outbreak squeezed retail demand

Reuters April 07, 2020 11:41:02 IST
Gold prices ease from 4-week high as dollar, equities strengthen on signs of coronavirus slowdown

Gold prices eased from a four-week high on Tuesday, as the US dollar and global equities strengthened on signs of a slowdown in coronavirus -related deaths.

Fundamentals

Spot gold was down 0.2 percent at $1,657.67 per ounce, as of 0110 GMT, after rising to a four-week high earlier in the session. The metal climbed 2.8 percent on Monday.

US gold futures rose 1.7 percent to $1,723.

The dollar was holding close to a near two-week high scaled in the previous session.

Asian markets looked poised on Tuesday to attempt another day of gains after stocks rallied on signs of easing coronavirus deaths, as oil prices resumed their decline on doubts about a potential Saudi-Russian pact to cut output.

Central banks have been turning to quantitative easing (QE), or large-scale purchases of government bonds and other financial assets to pump money into the economy.

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AFP

The Federal Reserve on Monday moved to bolster a new small-business lending program by allowing banks to turn those loans over to the US central bank for cash, easing concerns among banks about getting stuck holding the low interest loans.

A near total closure of US businesses as authorities try to control the spread of the virus could make US economic data unreliable in the coming months and harder to get a clearer picture of the severity of the recession caused by the virus.

Japanese Prime Minister Shinzo Abe pledged on Monday to roll out an unprecedented economic stimulus package, equal to 20 percent of economic output, as his government vowed to take “all steps” to battle the deepening fallout from the coronavirus .

The virus is the European Union’s biggest-ever challenge and member-states must show greater solidarity so that the bloc can emerge stronger from the economic crisis unleashed by the pandemic, German Chancellor Angela Merkel said on Monday.

Meanwhile, India’s gold imports plunged more than 73 percent year-on-year in March to their lowest in 6-1/2 years as record domestic prices and a lockdown to curb the outbreak squeezed retail demand, a government source said on Monday.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.54 percent to 984.26 tonnes on Monday.

Palladium rose 0.8 percent to $2,172.53 per ounce, while platinum was steady at $735.26.

Silver edged up 0.1 percent to $14.99 an ounce, having touched a more than three-week high earlier in the session.

Updated Date:

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