Gold set for third monthly gain; coronavirus pandemic fears lift rate-cut bets, epidemic may result in global, US recessions

Spot gold was unchanged at $1,642.03 per ounce. The metal was on track for a third straight monthly gain, advancing over 3.5 percent so far this month.

Reuters February 28, 2020 11:43:47 IST
Gold set for third monthly gain; coronavirus pandemic fears lift rate-cut bets, epidemic may result in global, US recessions
  • Spot gold was unchanged at $1,642.03 per ounce. The metal was on track for a third straight monthly gain, advancing over 3.5 percent so far this month

  • Investors braced for the impact on economic growth with global shares headed for the worst week since the financial crisis in 2008

  • Platinum was down 1 percent at $889.65, headed for its worst week since November 2015

Gold prices held steady on Friday as mounting concerns over the rapid spread of the coronavirus and its impact on global economy lifted expectations of rate cuts by major central banks, though  capped gains.

Spot gold was unchanged at $1,642.03 per ounce. The metal was on track for a third straight monthly gain, advancing over 3.5 percent so far this month.

US gold futures were up 0.1 percent at $1,643.50.

Gold set for third monthly gain coronavirus pandemic fears lift ratecut bets epidemic may result in global US recessions

Representational Image. AP

“This virus is getting a lot more serious, it has spread to so many different countries, not just China … people are worried that there might be a need for some more stimulus measures so that means lower (interest) rates,” said John Sharma, an economist at National Australia Bank.

“High prices have led to some profit-taking by investors, so that has capped the gains.”

All countries need to prepare to combat the coronavirus, the World Health Organization said on Thursday, as authorities raced to contain the epidemic’s rapid global spread.

Investors braced for the impact on economic growth with global shares headed for the worst week since the financial crisis in 2008, while US 10-year Treasury yields held close to a record low touched on Thursday.

Safe-haven Japanese yen also rose to its highest in more than three weeks against the US dollar.

Worries about the effect of the global spread of the virus persuaded investors to step up bets that the US Federal Reserve would need to cut interest rates as soon as next month to cushion the economy.

Moody’s Analytics said a pandemic would result in global and US recessions during the first half of this year, while rate cuts by the Federal Reserve might fall short of stabilising markets.

Four European Central Bank policymakers played down the prospect of immediate action to counter the economic impact of the virus, saying it was too early to gauge the long-term implications of the disease.

Lower interest rates reduce the opportunity cost of holding non-yielding bullion.

Among other precious metals, palladium slipped 2.3 percent to $2,779.30 per ounce, but was on track to register its best month since November 2016.

Platinum was down 1 percent at $889.65, headed for its worst week since November 2015.

Silver fell 0.6 percent to $17.59 an ounce, on track to post a weekly decline of more than 4.6 percent.

Updated Date:

also read

Gold price today: 10 grams of 24-carat stands at Rs 51,660; silver at Rs 57,500 per kilo
Business

Gold price today: 10 grams of 24-carat stands at Rs 51,660; silver at Rs 57,500 per kilo

In Ahmedabad and Lucknow, 10 grams of 22-carat gold is being obtained at Rs 47,410 and Rs 47,510, respectively. The same quantity of 24-carat purity is priced at Rs 51,720 in Ahmedabad and Rs 51,830 in Lucknow

Gold price today: 10 grams of 24-carat sold at Rs 51,490; silver at Rs 58,400 per kilo
Business

Gold price today: 10 grams of 24-carat sold at Rs 51,490; silver at Rs 58,400 per kilo

According to the MCX data, gold futures increased by 0.31 per cent to Rs 51,605.00 and silver futures also witnessed a surge of 1.27 per cent and settled at Rs 58,352.00

Gold price today: 10 grams of 24-carat falls to Rs 51,370; silver at Rs 58,300 per kilo
Business

Gold price today: 10 grams of 24-carat falls to Rs 51,370; silver at Rs 58,300 per kilo

In Patna and Coimbatore, 10 grams of 22-carat gold is being traded at Rs 47,120 and Rs 47,940, respectively. In Patna, the same quantity of 24-carat purity is priced at Rs 51,400, while in Coimbatore it is valued at Rs 52,290