On Wednesday the gold prices hit its highest level since October 2012, as the spread of the coronavirus intensified concerns about its impact on economic activity and global growth, boosting the demand and increasing the gold’s safe-haven value.
Spot gold surged up by 0.2 per cent at $1,769.59 per ounce, after hitting $1,773, its highest level since October 2012 in early Asian trade.
Gold on Wednesday,
Meanwhile, U.S. gold futures climbed up to its highest level in nearly eight years. U.S. gold futures GCv1 was up with 0.4 per cent at $1,789.20.
For a second consecutive week, the coronavirus cases in the U.S. surged up by 25 per cent and there are fears of second wave cases, especially in the U.S., and also in Latin America, driving the concerns about the pandemic’s impact on economic activity and global growth, increasing the gold’s safe-haven value.
Globally Central banks are taking aggressive stimulus measures and keeping their interest rates low, helping the gold prices to hike more than 16 per cent this year, as the yellow metal is widely seen as a safe option amid these uncertain conditions.
During this entire scenario, gold tends to benefit from widespread crisis and several stimulus measures that several central banks are taking because it is widely viewed as a hedge against inflation and currency debasement
Further boosting gold, the dollar index. DXY fell by 0.1 per cent and stuck near a more than one-week low hit during the last session.
U.S. Treasury Secretary Steven Mnuchin announced the next stimulus bill will mainly focus on getting people back to their work as soon as possible and he would consider a further delay of the deadline to file tax returns. On Tuesday the number of infections and the death in Latin America passed 100,000, a Reuters tally showed.
Meanwhile, the European Union is prepared to bar travelers from the United States due to the continuous increase in the number of cases.