LONDON: Gold jumped to a record high on Wednesday, pushing further past the US$2,000 mark in the face of a weak dollar, falling US Treasury yields and expectations of more stimulus measures for the pandemic-ravaged global economy.
European stocks opened higher, aided by a batch of positive earnings. US equity futures rose too, indicating a firm open for Wall Street, while MSCI’s broadest index of Asia Pacific shares outside of Japan rose 0.7% to a 6-1/2 month peak.
But it was the relentless rally in gold that held the spotlight as prices hit a fresh record high at around US$2,039 per ounce.
The precious metal, which has soared more than 30% this year, is benefitting from heightened uncertainty around the long-term effects of the global health crisis.
Weakness in the dollar and falling US Treasury yields have encouraged investors to look for an alternative store of value, boosting the appeal of gold.
“What we’re seeing at the moment with the dollar, bond yields and gold are macro trades of concern – not just about the coronavirus but also about the fiscal cliff in the US,” said Seema Shah, chief strategist at Principal Global Investors in London. – Aug 5, 2020, Reuters
