Gold eases on firmer dollar, but holds near one-week high
· Gold eased on Thursday as the dollar firmed but fears over a fresh wave of coronavirus infections and the U.S. Federal Reserve’s pledge to keep interest rates low kept bullion close to its highest in over a week.
· Spot gold was down 0.33% at $1,730.58 per ounce, having earlier hit its highest since June 2 at $1,744.36. U.S. gold futures settled up 1.1% at $1,739.80.
· “You had a lot of fresh infections, which seemed to spook investors a bit so that pretty much put everybody into a risk-off and basically they’re selling everything except for the dollar and natural gas,” said Michael Matousek, head trader at U.S. Global Investors.
· The dollar rose versus major currencies, benefiting from safe-haven flows as Wall Street slumped on reports of a rise in virus cases as most U.S. states reopen.
· Traders did not read too much into the slight pullback in gold, saying the safe-haven metal’s longer term trajectory was still positive.
· On Wednesday, spot gold notched up its biggest daily percentage rise in more than a month, as the Fed flagged the need to keep the key interest rate near zero through at least 2022.
· Gold has rallied about 20% since touching an over three-month low of $1,450.98 on March 16.
· Low interest rates tend to support gold, considered a hedge against inflation and currency debasement.
· Elsewhere, silver declined 3.1% to $17.69 per ounce, after rising 3.8% on Wednesday.
· Palladium fell 1% to $1,928.03 per ounce, and platinum dipped 2.2% to $814.30.
Reference: CNBC
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