Gold dips as investors overlook stimulus measures in cash dash

Bitcoin Gold Spike as Fed Unveils Unlimited Coronavirus Stimulus Package

Gold has rallied on US Federal Reserve's announcement of unlimited quantitative easing and programmes to support credit markets.

Spot gold climbed as much as 4.2 per cent to US$1,618.20 an ounce, before paring some of the gains. Gold futures were now trending at Rs 41,037 per 10 grams on MCX with an increase of 1.59 per cent or Rs 644.

"The Fed unveiled its biggest cannon seen to date - even bigger than in the great financial crisis", said Tai Wong, head of base and precious metals derivatives trading at BMO.

Meanwhile, almost one in three Americans were ordered to stay home to slow the spread of the disease, while Italy banned internal travel as deaths there reached 5,476 and China reported 46 new cases on Sunday that were mostly imported from overseas.

USA gold futures climbed 1.6 per cent to $1,687.30.

The precious metal jumped, rallying with risk assets, after the US central bank said on Monday it would buy unlimited amounts of Treasury bonds and mortgage-backed securities to keep borrowing costs low.


Gold prices inched up in volatile trade on Wednesday, as growing hopes for a massive US economic stimulus package to stem the coronavirus outbreak's economic toll offset liquidation by investors looking for cash and to cover losses in other assets.

U.S. stock index futures surged more than 3 per cent, while the dollar fell over 1 per cent against major currencies after the Fed's latest announcement.

"When you're seeing so much wiped off the stock market on a regular basis, the shortfall has to be made up somehow and gold remains the favoured option", OANDA analyst Craig Erlam said in a note.

Goldman reaffirmed its 12-month target for bullion to advance to $1,800 an ounce, saying that both near-term and long-term outlooks for bullion were looking far more constructive.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 1.3 per cent to 935.98 tonnes on Tuesday.

At 11:51 am, benchmark equity markets benchmarks S&P BSE Sensex and NSE Nifty 50 were up 1.28 per cent at 27,014.98 and 1.19 per cent at 7,894.25 respectively, a day after Prime Minister Narendra Modi ordered a 21-day nation-wide lockdown to contain the rapid spread of the coronavirus.

Related:

Comments

Latest news

Niagara cruise passengers isolated in staterooms amid coronavirus fear
Despite previous confirmations that passengers could disembark in Punta Arenas, Chile, for flights, the cruise line was blocked from doing so.

Number of COVID-19 cases among Amazon workers rises
This news comes shortly after Amazon temporarily closed one of its NY delivery stations due to an employee contracting the virus. However, several employees told CNET that the offer is not enough and asked for more paid time off for all hourly workers.

‘Top Chef Masters’ Chef Floyd Cardoz Dies Of Coronavirus At 59
The Mumbai-raised chef had been in Mumbai until March 8. "Hospitality, on March 25, 2020 in New Jersey, USA", it said . Soho's Paowalla, which was later transformed into Bombay Bread Bar, closed a year ago .

Fury-Wilder III set to be pushed back from July to October
And Arum confirmed to ESPN that all parties involved in getting the third fight on the table are working through their process.

Plague Inc. Getting Free New Mode in Which You Fight a Pandemic
It will be free for all players during the COVID-19 pandemic , and more information will follow as soon as possible. Dr Richard Hatchett, CEO of CEPI, praised the studio and said games could play a part in fighting the pandemic .

Other news