Gold falls nearly 5% on Covid-19 vaccine euphoria - Dateline Africa
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Gold falls nearly 5% on Covid-19 vaccine euphoria

Gold falls nearly 5% on Covid-19 vaccine euphoria

Gold tumbled nearly 5% on Monday as news of the first successful late-stage Covid-19 vaccine trials prompted investors to dump safe-haven bullion and flock to riskier assets falls nearly 5% on Covid-19. Spot gold was down 4.8% at $1,857.61/oz in New York, while US gold futures settled down 5% at $1,854.40.

Spot prices beat a sharp retreat from a near two-month peak of $1,965.33 hit earlier amid a weaker dollar and hopes for more stimulus after Joe Biden’s victory in the US elections.

Equities surged after Pfizer said its experimental Covid-19 vaccine was more than 90% effective. Pfizer and German partner Biotech said they expect to seek US emergency use authorisation later in November.

“(The news) really exceeded everyone’s best-case scenarios. There was growing nervousness that we might not get a strong vaccine result, so this unleashed the risk-on trade and for gold, signalled a huge exodus of safe-haven plays,” said Edward Moya, senior market analyst at Oanda.However, he added, “the economy is still in need of much support … so we’re not in the clear with the virus and the calls for stimulus will be growing.”

Bullion, a hedge against currency debasement and inflation, has climbed 22% in 2020, mainly driven by unprecedented“If you think that you’re living in the best of all worlds, then you don’t need gold,” said Commerzbank analyst Daniel Briesemann.

 

“However, this assessment seems to be premature. And we’ve often seen in the past that at prices below $1,900, buying interest will come into the market — we would expect that to happen again this time.”

Other precious metals also sold off, with silver sliding 7.3% to $23.73/oz, platinum falling 2.9% to $863.02 and palladium shedding 0.7% to $2,474.51.ed global pandemic-led stimulus

Reuters

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