Thursday, November 12, 2020

Gold Still Has Not ‘Move On’ With Vaccine News

 The yellow-gold metal continued to trade flat after recording a slight increase at the beginning of the Asian session amid growing confidence in the potential Covid-19 vaccine.

Spot gold traded hovering around the price level of $ 1,870 per ounce, while gold futures traded at $ 1,867 per ounce (3.15pm Malaysian time).

Positive news about vaccines developed by Pfizer and BioNTech has supported market sentiment on risky assets and pressed gold trading to fall around 4.2% this week.

However, due to the current situation which still sees a high increase in cases of Covid-19 infection, especially in the United States and Europe, some investors are reluctant to release gold safe-haven assets.

Cases around the world continue to show improvement, putting hope for the global economic recovery to fade again. The latest data from Johns Hopkins University shows that the number of global cases has exceeded 52 million and the death toll is over 1.28 million.

Meanwhile, European Central Bank (ECB) President Christine Lagarde continues to signal to increase support for the economy following the growing number of cases in Europe and it is also expected to worsen in the winter.

Gold tends to benefit from stimulus measures from the central bank as it is seen as a hedge against inflation and depreciation.