The market was shocked by the buzz on the ‘blue bird’ social site, Twitter of US President Donald Trump at the New York session on the implementation of the new US stimulus package that affected the stock and commodity markets.
The yellow metal trade plunged lower after Trump surprised investors by stopping talks with Democrats on a new stimulus package, prompting a surge in US dollars.
Spot gold traded low at around $ 1,879 per ounce, while gold futures declined at $ 1,883 per ounce (10am Malaysian time).
The precious metal initially soared to $ 1,920 an ounce following Federal Reserve President Jerome Powell's warning that the US economic recovery would slow down if the Covid-19 spread was out of control and called for more stimulus measures.
However, hopes for more aid to Americans and airlines struggling with the Covid-19 pandemic were shattered after Trump ended talks until after the November 3 presidential election.
Gold tends to benefit from widespread stimulus measures as it is seen as a hedge against inflation and major currencies.
The dollar index traded positively with a 0.2% increase to 93.90 against most major currencies.
