Gold decreased Friday, as investors preferred to profit from sharp gains in previous sessions as stocks soared. However, forecasts for the new US incentive reinforced the Gold price’s appeal as an inflation protection, achieving its first weekly gain in four weeks.
Spot gold gained 2.6% on a weekly basis and reached the level of $ 1840. Tai Wong, head of base and precious metal derivatives trading at BMO, said, “After a spectacular four-day bounce, gold is trying to make a profit ahead of the basic technical level of $ 1,850. For the last two months, this level of support has been considered a major obstacle as it is remarkably flexible” he says.
Data on Friday showed that the US economy added the least number of job positions in six months in November, reinforcing expectations for more financial incentives that raised Wall Street’s main indexes to an all-time high. The $ 908 billion coronavirus aid law received support in the US Congress on Thursday. “
Beyond Short Term Adjustments, A Weaker Dollar, Negative Interest Rates”
Standard Chartered analyst Suki Cooper says that factors such as real interest rates, concerns surrounding inflation and expectations for more fiscal stimulus amidst supportive monetary policy can keep the gold price risk up. Meanwhile, the dollar has entered its worst week since early November, making gold cheaper for other currencies. Platinum rose 2.9% to $ 1,059.17 per ounce and was on track to experience its best week since late March. Silver rose 0.2% to $ 24.11, while palladium rose 2.3% to $ 2,353.56.