News ID: 270832
Published: 0630 GMT June 30, 2020

Gold poised for best quarter in four years as virus fears persist

Gold poised for best quarter in four years as virus fears persist
Gold bars and coins are stacked in the safe deposit boxes room of the Pro Aurum gold house in Munich, Germany. (REUTERS)

Gold held close to a near eight-year peak on Tuesday, en route to its best quarter in more than four years, as worries over rising cases of the novel coronavirus and its economic fallout boosted safe-haven demand.

 

Spot gold was steady at $1,771.30 per ounce by 0306 GMT, just $7.76 shy of a near eight-year high of $1,779.06 hit last week. US gold futures rose 0.2 percent to $1,783.80, Reuters reported.

Bullion, with more than 12 percent gains this quarter, is on track for its best quarter since end-March 2016, and is also headed for a third straight monthly gain.

"Gold's main supports right now are negative real interest rates across the US yield curve, and risk event hedging. In that, you can lump US COVID-19 situation, and US-China relations," said Jeffrey Halley, senior market analyst at OANDA.

A spike in COVID-19 cases in recent days has pushed some US states to reverse re-openings and close businesses such as bars again to curtail its spread.

US Federal Reserve Chair Jerome Powell said the outlook for the world's biggest economy is "extraordinarily uncertain" and will depend both on containing the disease and on the government's efforts to support the recovery.

Central banks worldwide have adopted aggressive stimulus measures and kept interest rates low, helping the non-yielding asset surge more than 16 percent this year.

Capping gold's advance were better-than-expected economic readings out of the US and China, which lifted investors' appetite for riskier assets.

"The fact gold prices remain fairly constructive around risk-on is a bullish sign in its own right," said Stephen Innes, chief market strategist at financial services firm AxiCorp, in a note.

Elsewhere, palladium fell 0.5 percent to $1,895.06 per ounce, while platinum rose 0.2 percent to $807.46. Silver was steady at $17.85.

   
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