Gold price falls on dollar strength

Gold price falls dollar strength hopes for coronavirus vaccine

Prices of Gold fell on Wednesday, pressured by the strength of the dollar. Besides, optimism about a possible COVID-19 vaccine and an economic recovery from the pandemic hurt demand for bullion and supported risky assets. The gold prices dropped by 0.7% to the US $ 1,715.27 an ounce. Meanwhile, gold futures in the US fell 0.9% to the US $ 1,721.40.

Jigar Trivedi, a commodities analyst, stated that hopes for a treatment for the coronavirus and the rise in the dollar following robust US retail sales data and an increase in manufacturing output fueled profit-taking in the gold market.

The Chinese government banned flights because of the new emerged cases of the coronavirus in the capital

Against a basket of currencies, the dollar index was up 0.3%. Investors were also watching for events in Beijing. The country detected new cases of the pandemic. In an attempt to contain a new outbreak, the government banned unessential travel outside of the capital. Dozens of domestic flights were canceled to bring the spread of the virus under control. Besides, all the residential compounds were ordered to restore screening procedures. Chinese government officials said at the briefing that they would strictly control all the movement in and out of the city.

Beijing reported 31 new cases on Tuesday. Over the past six days, the number of infections totaled 137. New cases are linked to a wholesale food market located in the south-eastern district of Fengtai. The disease has spread to 9 of the city’s 17 neighborhoods.

Trivedi stated that if governments confirm the second wave of coronavirus, then it is likely that gold will be priced at $ 1,740.

Among other metals, palladium rose 0.2% to $ 1,934.81 an ounce, while platinum lost 0.9% to $ 813.3. Meanwhile, silver gained 0.3% at $ 17.44.

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