November 24, 2020

Gold costs: Gold slides alongside equities on US election doubts

Gold costs fell sharply on Thursday, drifting away from a report peak hit earlier this week, as a hunch in US GDP and President Donald Trump’s tweet about delaying the upcoming US elections triggered a sell-off in monetary markets.

Spot gold dipped 1.2% to $1,947.28 per ounce by 11:54 a.m. EDT (1554 GMT), whereas US gold futures slid 0.7% to $1,940.2.

“Individuals are panicking and fleeing the fairness markets and also you’re seeing that weighing on metals costs,” mentioned Phillip Streible, chief market strategist at Blue Line Futures in Chicago.

A historic plunge in second-quarter GDP and a tweet by President Donald Trump elevating the potential for delaying the US November presidential elections weighed on US stocks and Treasury yields.

Bullion was additionally pressured because the greenback stalled its slide after the US Federal Reserve mentioned it stays dedicated to preserving rates of interest close to zero so long as crucial for the financial system to get well.

“The Fed did not actually lay out a selected roadmap so far as the best way to get us all the best way again up, they only mentioned they might be accommodative,” Streible added.

The non-yielding steel, which advantages from low rates of interest, jumped to a report excessive of $1,980.57 per ounce on Tuesday and is up over 28% to this point this 12 months, supported by sturdy funding demand.

“We have seen gold’s positioning has began to bloat not solely from the institutional aspect, however extra just lately now we have actually seen a surge in retail flows,” mentioned Daniel Ghali, commodity strategist at TD Securities.

“In order that’s actually assigned to speculative frenzy happening in gold for the time being … we expect a interval of consolidation right here earlier than gold continues to rally later within the 12 months.”

Different metals had been additionally decrease, with silver shedding about 5% to face at $23.19 per ounce, platinum was down 3.6% at $891.33 and palladium dropped 3.8% to $2,075.55.