Gold edges up as coronavirus worries eclipse vaccine optimism: Check today's rate

Filed on November 12, 2020 | Last updated on March 19, 2021 at 01.22 pm
KT file photo by Ryan Lim

Gold prices have come under pressure after encouraging late-stage coronavirus vaccine trial data.

Gold prices edged higher on Thursday, after dropping over 1 per cent in the previous session, as concerns over the economic fallout from surging Covid-19 cases outweighed positive vaccine news.

Spot gold rose 0.3 per cent to $1,869.51 per ounce by 0339 GMT.

24k gold in Dubai is priced at Dh225.25 and shoppers can indulge in buying 22k for Dh211.50.

US gold futures were 0.4 per cent higher at $1,869.30.

“Gold traders are trying to strike a balance between a positive vaccine news versus a rising number of coronavirus cases around the globe,” said Margaret Yang, a strategist with DailyFx, which covers currency, commodity and index trading.

Although the vaccine may affect the medium- to long-term trend of gold prices, monetary and fiscal stimulus are needed in the near-term to shelter the global economy, Yang said.

European Central Bank President Christine Lagarde signalled further support for the economy on Wednesday as the pandemic intensified in Europe, with cases expected to spike in winter.

Gold tends to benefit from widespread stimulus measures from central banks because it is considered a hedge against inflation and currency debasement.

Risk appetite has been boosted by hopes of a successful vaccine, but analysts say it may take a long time before one becomes publicly available.

Gold prices have come under pressure after Monday's encouraging late-stage coronavirus vaccine trial data by Pfizer and BioNTech. Prices are down 4.2 per cent so far for the week.

“The reality is we are just holding above the support levels between $1,850 and $1,860 and a breach there would introduce some pretty serious downside potential,” said Michael McCarthy, chief strategist at CMC Markets.

The dollar index held steady near a one-week high hit on Wednesday.

Silver fell 0.1 per cent to $24.23 per ounce. Platinum rose 0.1 per cent to $866.25, while palladium was up 0.8 per cent at $2,333.53.

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