This Article is From Jul 10, 2020

Spot Gold Headed For Fifth Weekly Gain In A Row As Risk Appetite Wanes

Gold has risen about 18 per cent this year, with safe-haven demand fuelled by the surge in coronavirus cases driving the metal to a near nine-year peak of $1,817.71 per ounce on Wednesday.

Spot Gold Headed For Fifth Weekly Gain In A Row As Risk Appetite Wanes

US gold futures fell 0.1% to $1,801.10 per ounce

Gold eased on Friday pressured by a stronger dollar and hovered near the key $1,800 milestone, but was set for a fifth straight weekly gain as a spike in US COVID-19 infections underpinned safe-haven appetite. Spot gold was down 0.4 per cent at $1,796.03 per ounce by 0614 GMT (11:44 am in India)), but was up about 1.2 per cent for the week. US gold futures fell 0.1 per cent to $1,801.10 per ounce.

"The risk-off backdrop drove haven demand for the US dollar," pushing gold lower, said DailyFx currency strategist Ilya Spivak.

"Nevertheless, the pullback looks corrective in the context of a rising trend."

Gold has risen about 18 per cent this year, with safe-haven demand fuelled by the surge in coronavirus cases driving the metal to a near nine-year peak of $1,817.71 per ounce on Wednesday.

More than 60,000 fresh COVID-19 cases were reported across the US on Wednesday, the largest one-day increase by any country since the pandemic emerged in China last year.

Reflecting the resultant risk-off sentiment, Asian equities fell on concerns of fresh lockdowns in the US; which also boosted the dollar, a rival safe-haven, making gold more expensive for holders of other currencies.

Data showed US shoppers were staying out of stores in areas where cases are rising the most, dampening hopes of a quick recovery in the world's biggest economy.

Americans filing for jobless benefits dropped to a near four-month low last week, but a record number were still collecting unemployment checks in the third week of June, supporting expectations the labour market would take years to recover.

For gold, longer-term technicals suggest a slowing in the price momentum, with positioning pointing to a market very long on gold and implying a short-term pullback is possible, IG Markets analyst Kyle Rodda said.

Palladium fell 0.2 per cent to $1,938.83 per ounce, platinum declined 0.8 per cent to $826.65, and silver slipped 0.6 per cent to $18.54.