Gold poised for best quarter in years as virus fears persist

Gold poised for best quarter in years as virus fears persist

Gold held close to a near eight-year peak on Tuesday, en route to its best quarter in more than four years, as worries over rising cases of the novel coronavirus and its economic fallout boosted safe-haven demand.Spot gold was steady at $1,772.14 per ounce by 0703 GMT, just $6.92 shy of a nearly eight-year high of $1,779.06 hit last week. U.S. gold futures rose 0.3% to $1,787.30.

Bullion, with quarterly gains of more than 12%, is on track for its best quarter since end-March 2016 and is also headed for a third straight monthly gain.

“Gold’s main supports right now are negative real interest rates across the U.S. yield curve and risk event hedging. In that, you can lump U.S. COVID-19 situation and U.S.-China relations,” said Jeffrey Halley, senior market analyst at OANDA.

A spike in COVID-19 cases in recent days has pushed some U.S. states to reverse re-openings and close businesses such as bars again to curtail its spread.

The U.S. Federal Reserve Chair Jerome Powell said the outlook for the world’s biggest the economy is “extraordinarily uncertain” and will depend both on containing the disease and on the government’s efforts to support the recovery.

Central banks worldwide have adopted aggressive stimulus measures and kept interested rates low, helping the non-yielding asset surge more than 16% this year.

Capping gold’s advance was better-than-expected economic readings out of the U.S. and China, which lifted investors’ appetite for riskier assets.

“The fact gold prices remain fairly constructive around risk-on is a bullish sign in its own right,” said Stephen Innes, chief market strategist at financial services firm AxiCorp, in a note.

Elsewhere, palladium gained 0.5% to $1,912.32 per ounce, platinum rose 0.8% to $811.78 and silver edged 0.1% higher to $17.87.

Gold poised for best quarter in years as virus fears persist Anupreet Kaur:

All Time Favorite