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Gold prices soar towards 8-year high as coronavirus cases jump

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Gold surged to its highest in almost eight years on Wednesday as rising coronavirus cases globally dented hopes of a speedy financial restoration and pushed traders towards protected haven belongings.

Spot gold prices climbed 0.6% to $1,777.53 per ounce by 0957 GMT, having earlier hit their highest since October 2012 at $1,779.06.

U.S. gold futures gained 0.7% to $1,794.60.

“Everyone is nervous a couple of second wave of the coronavirus not solely within the U.S., however in Latin America, Brazil and Russia, in order that’s supporting the rally,” stated Jigar Trivedi, commodities analyst at Mumbai dealer Anand Rathi Shares.

“Individuals are anticipating stimulus packages from central banks and better the stimulus, higher the prospects for gold.”

The US had a 25% enhance in new cases of COVID-19 within the week ended June 21 in contrast with the earlier seven days, whereas the loss of life toll in Latin America has surpassed 100,000, a Reuters evaluation discovered.

The European Union is ready to bar travellers from the US, placing the nation in the identical class as Brazil and Russia, the New York Instances stated.

The surge in coronavirus cases additionally weighed on international inventory markets.

World central banks have bumped up stimulus measures and stored rates of interest low to ease the financial blow from the pandemic, driving a greater than 16% rise in gold this 12 months, as it’s broadly seen as a hedge in opposition to inflation and currency debasement.

Indicative of investor sentiment, holdings in SPDR Gold Belief , rose 0.28% to 1,169.25 tonnes on Tuesday, its highest degree since April 2013.

Julius Baer analyst Carsten Menke stated: “We persist with our view {that a} quick and sharp recession is totally priced into gold round $1,700 per ounce and {that a} additional deterioration of the financial atmosphere is required to lastingly elevate prices.”

He additionally stated that short-term dangers had been now skewed to the upside as technical merchants and development followers had been being lured again into the market.

Elsewhere, palladium rose 1% to $1,942.75 per ounce, platinum was up 0.1% at $830.25.

Silver was little modified at $17.96.

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