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Asha Sistla

Gold rises on soft dollar, stimulus bets as virus risks grow

26 Nov 2020

Gold gained on a softer dollar on Thursday and as a mounting number of COVID-19 cases and their economic toll raised investor expectations of further fiscal and monetary support.

PRECIOUS-Gold dips to four-month low as vaccine hopes take centre stage

24 Nov 2020

(Updates prices, adds context) * Gold's break below $1,800/oz could prompt further dip -analyst * European shares gain on vaccine optimism * EU reaches deal with Moderna for vaccine supply * Interactive graphic tracking global spread of coronavirus: * https://tmsnrt.rs/3aIRuz7 in an external browser By Asha Sistla Nov 24 Gold slid to a four-month low on Tuesday, extending a sharp slide from the previous session as optimism over the development of COVID-19 vaccines drove investors to riskier assets. Spot gold dropped 1.3% to $1,812.81 an ounce by 1218 GMT, having touched its lowest since July 17 at $1,804.70, while U.S. gold futures lost 1.5% to $1,810.60. European equities rose on a possible easing of COVID-19 curbs and progress on vaccines from the likes of AstraZeneca , Pfizer and Moderna . The European Union has reached a deal with U.S. biotech company Moderna for supply of its vaccine, an EU official told Reuters on Tuesday. "We had news about the vaccine, saw yields moving higher in U.S.; even the dollar went lower and gold is not profiting from that ... This is a very bad sign for gold and means there is underlying weakness building up," said ABN Amro analyst Georgette Boele. A break below support at $1,800 would trigger further price declines, Boele added. The dollar held close to its lowest in nearly three months, potentially making gold cheaper for buyers with other currencies. Equities markets were also supported by clearance for U.S. President-elect Joe Biden's transition to the White House, even though President Donald Trump stopped short of conceding defeat in the Nov. 3 election. "The acknowledgement of Biden's victory from the Republicans is likely to reduce the risk of further tensions and represents a supportive element for stocks, while haven assets such as gold are suffering," ActivTrades' chief analyst Carlo Alberto De Casa said in a note. However, central banks will still be forced to print a huge amount of money, which could revive investor interest in gold before long, De Casa added. Gold is considered a hedge against inflation and currency debasement that is likely to result from unprecedented global stimulus to fight the economic impact of the COVID-19 pandemic. In other precious metals, silver dipped 1.4% to $23.25 an ounce, platinum was flat at $925.87 and palladium dropped 1.4% to $2,323.13. (Reporting by Asha Sistla in Bengaluru Editing by Mark Potter and David Goodman)

PRECIOUS-Gold dips as AstraZeneca adds to vaccine optimism

23 Nov 2020

(Adds analyst comment, updates prices) * AstraZeneca says COVID-19 vaccine can be 90% effective * Equities rally, dollar dips to near three-month low * Interactive graphic tracking global spread of coronavirus: open * https://tmsnrt.rs/3aIRuz7 in an external browser By Asha Sistla Nov 23 Gold prices eased on Monday as drugmaker AstraZeneca injected fresh optimism into the race for a COVID-19 vaccine, bolstering appetite for riskier assets and overshadowing support for bullion from a weaker dollar. Spot gold had fallen 0.4% to $1,863.21 per ounce by 1328 GMT and U.S. gold futures were 0.6% lower at $1,861.40. Britain's AstraZeneca said its vaccine could be around 90% effective and will have as many as 200 million doses by the end of 2020. "The fact that we have three vaccine results that are extremely positive is keeping gold under pressure in the near term and also stopping it from any kind of significant rebound," said OANDA analyst Craig Erlam. The positive vaccine developments prompted investors to bet on a quicker global economic recovery, driving equities higher. But bullion's losses were capped by a weaker U.S. dollar, which slipped to a near three-month low, making gold an attractive bet for those holding other currencies. "The expectation now is that there's an extremely strong chance that the ECB and Fed announce more stimulus measures in December in order to support these markets at a time when the COVID spread is getting quite severe and we're seeing lockdown restrictions," OANDA's Erlam said. Non-yielding gold is often seen as a hedge against inflation that is likely to result from the unprecedented stimulus measures adopted globally this year. "The only short-term potential trigger for a move higher (in gold) might be the announcement of a new Treasury Secretary by U.S. President-elect Joe Biden and restart of discussions about a second U.S. stimulus package," said Stephen Innes, chief global market strategist at financial services firm Axi, in a note. Silver fell 0.6% to $24.00 an ounce, platinum dipped 0.6% to $940.00, while palladium was up 0.1% at $2,328.02. (Reporting by Asha Sistla in Bengaluru; Editing by Emelia Sithole-Matarise and Kirsten Donovan)

PRECIOUS-Gold set for second weekly dip on end of Fed stimulus, vaccine optimism

20 Nov 2020

* Gold's move above $2,000 in 2021 still likely - Citi * Outflows of about 40 tonnes so far in November from SPDR ETF * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Updates prices) By Asha Sistla Nov 20 Gold was headed for a second weekly decline on Friday on growing optimism about COVID-19 vaccines, with the U.S. Treasury's call to end emergency loan programmes also limiting bullion's safe-haven appeal. Spot gold eased 0.1% at $1,866.38 per ounce by 1227 GMT and was down 1.2% for the week. U.S. gold futures were up 0.1% at $1,864. U.S. Treasury Secretary Steven Mnuchin said key lending programs at the Federal Reserve would expire on Dec. 31, casting doubts over the future of fiscal support. While the news weighed on risk sentiment, it did not stop world stocks from gaining on the back of brightening prospects for a faster economic recovery thanks to positive developments on the vaccine front. "The underlying momentum behind gold has dissipated," said independent analyst Ross Norman, adding gold was pressured by year-end profit-taking and investors liquidating long positions. Investors pulled $4 billion from gold, the biggest outflow ever, amid a rush for riskier assets last week, BofA said on Friday. Also, holdings in the SPDR Gold Trust exchange-traded fund have seen net outflows of about 40 tonnes so far in November. "But it's important to remember that the gold bull run was never predicated on COVID-19," and factors including a weak economy and the likelihood of interest rates remaining subdued for an extended period will continue to support it, Norman added. Lower interest rates make gold an attractive bet by reducing the opportunity cost of holding the non-yielding metal, with near-zero interest rates globally contributing to its about 23% gain for the year. "Positive COVID-19 vaccine developments should slow but not end the secular gold bull cycle without a hawkish pivot in U.S. monetary policy," Citi Research said in a note. Silver rose 0.2% to $24.13 per ounce. Platinum climbed 0.3% at $954.21, while palladium rose 0.5% to $2,337.40. (Reporting by Asha Sistla in Bengaluru; editing by David Evans)

PRECIOUS-Gold slips on firmer dollar, vaccine boost to economic outlook

19 Nov 2020

* U.S. weekly initial jobless claim data due 1330 GMT * Dollar snaps five sessions of losses * GRAPHIC: Tracking the vaccine race https://tmsnrt.rs/3nGrJoP * Graphic tracking world spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Updates prices) By Asha Sistla Nov 19 Gold fell to a one-week low on Thursday as the dollar regained momentum and optimism that progress on vaccine development would hasten economic recovery eroded bullion's safe-haven appeal. Spot gold fell 0.5% to $1,861.35 per ounce by 1311 GMT, having earlier hit its lowest since Nov. 9 at $1,854.60. U.S. gold futures slipped 0.7% to $1,860.80. Gold is the victim of optimism over a coronavirus vaccine and a strengthening dollar pushing it towards the bottom end of its range, Michael Hewson, chief market analyst at CMC Markets UK, said. "U.S. fiscal stimulus remains an issue because (Donald) Trump hasn't yet conceded the presidential election, so fiscal support remains far away," he added. The dollar , considered a rival safe haven, was up 0.3% versus rivals, benefiting from uncertainties over a spike in new coronavirus cases in the United States and resultant restrictions. Rising cases in Europe too pushed world stocks further away from record peaks scaled after promising vaccine announcements from Pfizer and Moderna. The vaccines could be ready for U.S. authorisation within weeks, U.S. Health and Human Services Secretary Alex Azar said on Wednesday. "In the short term, (gold) prices may continue to drift lower towards $1,800," Vincent Tie, sales manager at Silver Bullion, said. Gold has gained some 23% this year, boosted by its appeal as a hedge against inflation and currency debasement that may follow the unprecedented global stimulus. "What hasn't changed is the prospect of near-term economic damage due to rising virus cases," said Hewson, adding that central banks might have to do the "heavy-lifting" in the short-term. Investors awaited U.S. jobs data at 1330 GMT for evidence on the state of the economy. Silver dipped 1.6% to $23.92 per ounce. Platinum rose 0.7% to $948.50, while palladium fell 0.5% to $2,317.50. (Reporting by Asha Sistla and Eileen Soreng in Bengaluru; Editing by Mark Heinrich/Barbara Lewis/Jane Merriman)

PRECIOUS-Gold slips on Pfizer boost to risk appetite

18 Nov 2020

* Pfizer to apply for emergency U.S. authorization for vaccine * Platinum market seen in deficit this year and next - WPIC * Fed's Powell says "long way to go" for economy to recover * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa</Paragraph > (Adds analyst comments, updates prices) By Asha Sistla Nov 18 Gold slipped on Wednesday on more positive developments on Pfizer's race for a COVID-19 vaccine, accelerating a move into riskier assets again. Spot gold was down 0.3% to $1,872.71 per ounce by 1321 GMT, while U.S. gold futures fell 0.7% to $1,872.10. U.S. drugmaker Pfizer Inc said on Wednesday that it was set to apply for emergency U.S. authorization after final results from its vaccine trial showed a 95% success rate with two months of safety data. "The latest good news from the vaccine front that came out helps to support risk assets and this weighed on safe haven assets like gold," said Fawad Razaqzada, market analyst with ThinkMarkets. "As investors look forward to a normal future, expectations that monetary policy will be loosened further will fall," thereby reducing flows into safe-havens. Equities rose on the latest update from Pfizer, which overshadowed concerns over rising coronavirus cases globally. Gold shed more than 1% on Monday after Moderna became the second U.S. drugmaker to announce late-stage successful vaccine trials. The dollar index fell 0.1%, making gold cheaper for those holding other currencies. But looking ahead, an expansion in the U.S. Federal Reserve's quantitative easing programme in December may weaken the dollar and prove a tailwind for bullion, said Lukman Otunuga, senior research analyst at FXTM. Fed chair Jerome Powell said on Tuesday the central bank was committed to using all its tools to drive an economic recovery. Gold, considered a hedge against inflation and currency debasement, has gained 23% this year, benefiting from massive global stimulus. Silver fell 0.3% to $24.39 per ounce, palladium gained 0.8% to $2,336.45. Platinum was up 0.2% to $927.05. The World Platinum Investment Council projected a market deficit in 2020 and 2021. (Reporting by Asha Sistla in Bengaluru Editing by Robert Birsel and Chizu Nomiyama)

RPT-PRECIOUS-Gold listless as investors weigh vaccine cheer against rising cases

18 Nov 2020

(Repeats to fix formatting of bullet points, no change to text) * Dollar falls to over 1-week low, global shares little changed * Platinum market seen in deficit this year and next - WPIC * Fed's Powell says "long way to go" for economy to recover * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa * By Asha Sistla Nov 18 Gold held to a tight range on Wednesday as investors were caught between optimism over the development of novel coronavirus vaccines and the chances of more economic support as the number of infections in some places surged. Spot gold was little changed at $1,877.65 per ounce by 1026 GMT, while U.S. gold futures were down 0.5% to $1,876.60. Gold shed more than 1% on Monday after Moderna became the second U.S. drugmaker to announce late-stage successful vaccine trials. "On one side, optimism surrounding the latest vaccine developments is supporting risk sentiment, weighing on safe-haven assets. However, the rapid rise in the number of coronavirus cases in Europe and U.S. continues to foster a sense of unease and caution," said Lukman Otunuga, senior research analyst at FXTM. Gold "is likely to derive strength from a weaker dollar in the near term until more news on the vaccine front is revealed". The dollar index fell 0.2%, making gold cheaper for those holding other currencies. "We've seen a lot of good news in terms of the (U.S.) election passing without much disruption and the vaccine announcement, so we're maybe seeing a little bit of fatigue and consolidation on the back of that," said OANDA analyst Craig Erlam. The rising coronavirus cases also offset the vaccine-driven lift in global equities. Looking ahead, an expansion in the U.S. Federal Reserve's quantitative easing programme in December may weaken the dollar and prove a tailwind for bullion, Otunuga said. Fed chair Jerome Powell said on Tuesday the central bank was committed to using all its tools to drive an economic recovery. Gold, considered a hedge against inflation and currency debasement, has gained more than 24% this year, benefiting from massive global stimulus. Silver rose 0.2% to $24.51 per ounce, palladium was up 1% to $2,340.87. Platinum gained 0.9% to $933.53. The World Platinum Investment Council projected a market deficit in 2020 and 2021. (Reporting by Asha Sistla in Bengaluru Editing by Robert Birsel)

PRECIOUS-Gold eases as vaccine optimism counters rising virus cases

17 Nov 2020

* Virus surge prompts restrictions in Europe, U.S. * Global equities at record high, dollar subdued * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Updates prices) By Asha Sistla Nov 17 Gold inched lower on Tuesday as optimism over an effective COVID-19 vaccine offset concerns facing its eventual rollout, a subdued dollar and bets for further monetary support as infections surged in Europe and the United States. Spot gold fell 0.1% to $1,887.40 per ounce by 1156 GMT, but held in a tight $9 range. U.S. gold futures eased 0.1% to $1,886.20. "Gold is mirroring the reaction of really everybody watching the evolution of the vaccines," and the positive news is clearly keeping a cap on the gold market, said Robin Bhar, an independent analyst. "But it's still a long way to go" and long term factors, including likely inflation down the road, continue to be supportive for gold, Bhar added. Also stemming bullion's downside, the dollar index was down 0.3%. Gold shed as much as 1.3% on Monday after Moderna said its vaccine was 94.5% effective in preventing COVID-19 in a late-stage trial, becoming the second U.S. drugmaker after Pfizer to report results exceeding expectations. The vaccine news continued to buoy risk sentiment, although the rally stalled in European shares as focus turned to increasing coronavirus-led restrictions in Europe. Gold, considered a hedge against inflation and currency debasement, has gained over 24% this year, mainly benefiting from global stimulus and near-zero interest rates to cushion the effect of the pandemic. U.S. Federal Reserve Vice Chair Richard Clarida on Monday acknowledged the new vaccine as a positive for economic recovery and said that the Fed would apply an expansive view of the labour market before deciding on any rate hikes. Silver fell 0.6% to $24.60 per ounce. Platinum slipped 0.2% to $923.45, while palladium shed 0.4% to $2,322.75. "Strong car sales in China, a likely vaccine and recovering economic activity should keep the palladium market tight once again in 2021, lifting prices to $2,600/oz," UBS analysts said in a note. (Reporting by Asha Sistla in Bengaluru, additional reporting by Arpan Varghese; editing by Louise Heavens and Alexandra Hudson)

PRECIOUS-Gold slides 1% after Moderna boosts vaccine race

16 Nov 2020

* Moderna says vaccine 94.5% effective in preventing COVID-19 * U.S. Fed Vice Chair Clarida to speak at 1900 GMT * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Adds Moderna vaccine news, analyst comment, updates prices) By Asha Sistla Nov 16 Gold retreated more than 1% on Monday after drugmaker Moderna declared an effective COVID-19 vaccine in tests, bolstering hopes for a swifter economic recovery and accelerating a shift into riskier assets. Spot gold was down 0.7% to $1,875.71 per ounce at 1251 GMT, having earlier hit its highest since Nov. 9 at $1,898.81. U.S. gold futures slipped 0.7% at $1,873.80. Moderna became the second company in a week to report late-stage clinical trial results that exceeded expectations, but gold's price reaction was relatively mild compared to the more than 5% slump after Pfizer last Monday announced its vaccine was over 90% effective. Moderna's announcement added further fuel to a global stocks rally that had also been helped by strong Chinese factory output data. "We have similar news based on the headlines, and we also have a knee-jerk reaction in the gold market," said Julius Baer analyst Carsten Menke. "But certainly those (short-term traders) who were flushed out of the market last week didn't come back in the meantime, so the potential for another sell-off like last week was just lower." Meanwhile, the global coronavirus crisis showed no signs of abating, with cases crossing the 11-million mark in the United States on Sunday. While the markets anticipate a return to normalcy in the second half of 2021, that "still leaves a massive gap in some of the economies globally that needs to be filled by governments and central banks," said Saxo Bank analyst Ole Hansen. Gold, which benefits from stimulus measures since it's considered a hedge against inflation and currency debasement, has gained 24% this year. Investors are also awaiting economic cues from speeches by U.S. Federal Reserve policymakers this week, beginning with Vice Chair Richard Clarida at 1900 GMT. Silver eased 0.8% to $24.44 per ounce. Platinum rose 0.3% to $890.97, while palladium climbed 0.9% to $2,344.25. (Reporting by Asha Sistla and Sumita Layek in Bengaluru, editing by Mark Potter and David Evans)

PRECIOUS-Gold steady as rising virus cases offset vaccine optimism

13 Nov 2020

* Spot gold down 3.7% for the week * Silver down 5.4% for the week * Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Updates prices) By Asha Sistla Nov 13 Gold held steady in a narrow range on Friday, with optimism over a COVID-19 vaccine countered by market concerns about its rollout as global infections continue to mount. Spot gold were little changed at $1,877.30 per ounce by 1132 GMT but was down 3.7% for the week, heading for its worst weekly loss since September after the initial vaccine euphoria dented safe-haven investor demand. U.S. gold futures were up 0.2% at $1,877.60. "Gold has rebounded because the pandemic and the COVID-19 numbers globally are still rising. The market optimism towards the vaccine and risk-on sentiment has faded," said Bank of China International analyst Xiao Fu. "There's only going to be a limited number of vaccines produced in the next three months, even in 2021, but there could be other companies coming up with vaccines as well. There could be other factors like mutation of the virus, the need to develop a new vaccine." Gold slumped 4.6% on Monday, its biggest daily fall since Aug. 11, after drugmaker Pfizer and BioNTech SE said their COVID-19 vaccine was more than 90% effective based on initial trial results. U.S. Federal Reserve chairman Jay Powell and ECB President Christine Lagarde said the economy was still in for a tough time even if development of a potential vaccine was reason for some optimism further ahead. European officials warned against COVID-19 complacency and said that measures to control a surge in infections must continue. The dollar index held steady but was on track for a 0.7% weekly gain. In other precious metals, silver was flat at $24.22 an ounce, platinum rose 0.5% to $884.28 and palladium was up 0.5% at $2,343.11. (Reporting by Asha Sistla in Bengaluru Editing by David Goodman and David Evans)

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