Gold prices appeared to extend a winning streak to a fifth straight session on Thursday, bringing the yellow metal at a distance from a record settlement high of around $ 1,900 an ounce, underscoring the feverish demand for bullion amid the worst pandemic in more than a century.
If gold hits its all-time high in 2011, “who can say it can’t hit $ 2,000 next?” Fawad Razaqzada, a market analyst at ThinkMarkets, wrote in a research note Thursday. “Obviously, no one knows if it will get there, but the momentum is certainly bullish, and the fundamental backdrop remains favorable.”
Gold for August delivery GC00,
Comex rose $ 7.40, or 0.4%, to $ 1,872.50, after the metal gained 1.5% in the previous session. Prices based on the most active contracts have not been negotiated or settled at such high levels since September 2011, but the product is approaching its highest settlement recorded at $ 1,891.90 since August of that year, according to data from FactSet.
The rise in gold runs counter to the narrative of continued uncertainty about the economic outlook for the US and other countries trying to deal with the consequences of the COVID-19 pandemic.
There are now more than 15.25 million confirmed cases of COVID-19 worldwide, and around 624,000 people have died, according to data added by Johns Hopkins University.
Gold has flourished in this environment at least in part due to outsized efforts by central banks and governments to provide funds to lessen the economic effects of the global outbreak, which to a lesser extent has benefited the purchase of gold and silver.
Silver prices fell on Thursday. The September SIU20 contract,
They fell 38 cents, or 1.6%, to $ 22,765 an ounce, after rising 7.4% on Wednesday to extend its climb to its highest levels since 2014, after a recovery of 6.8% on Tuesday.
Read:Why is silver trading at a maximum of almost 4 years?
James Hatzigiannis, chief market strategist at Ploutus Capital Advisors, attributed the gold recovery to the combination of a weakening dollar, which is approaching the March lows this year, “the talks by both sides (House and Senate) and the president seriously indicates that they need another stimulus bill. ”
“This is causing investors to flee to assets that are considered an inflation hedge,” such as gold and other inflation-protected securities, he told MarketWatch. “I think inflation is certainly building up,” with significant increases in food prices and a hard-hitting US dollar.
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“Gold will definitely reach its record settlement price levels if we see continued progress from another stimulus bill … a resurgence of Covid cases and a continued free fall of the dollar.”
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Hatzigiannis believes “gold will definitely hit its record high levels of settlement prices if we see continued progress from another stimulus bill (which I think we will), a resurgence of Covid cases, and a continued free fall of the dollar” .
The ICE US Dollar Index DXY,
It is trading 1% lower to date and has lost 2.5% so far in July.
Thursday’s data showed that initial jobless claims in the United States increased in the week ending July 18 for the first time since late March, by 109,000 to 1.42 million.
The US jobs report has once again confirmed that the economy “desperately needs help,” said Naeem Aslam, chief market analyst at AvaTrade. That supports the gold haven.
Among other Comex metals, September copper HGU20,
rose 0.2% to $ 2.9305 per pound. Platinum October PLV20,
added 0.07% to $ 958.10 an ounce, while September PAU20,
it was trading at $ 2,218.10 an ounce, 0.5% less.
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