Gold prices retreat; favourable macros dampen investors’ appetite
- 2nd July 2020
- Posted by: Hakeem
- Category: Commodities
Gold futures dropped from its record highs on Thursday morning at London’s trading session as global investors retreated from the safe-haven asset as their appetite for riskier financial assets surge.
Gold futures were slightly down 0.02% to trade at $1,779 at 9:03 am Nigerian time, after losing more than 1% yesterday at America’s trading session.
Stephen Innes, Chief Global Market Strategist at AxiCorp in a note to Nairametrics spoke about the macros, affecting Gold as an asset. He said:
“Gold price got hammered lower after the vaccine headlines but have since stabilized and are ticking gingerly higher. A vaccine would be significant.
“However, I do not think it’s immediately or radically changing many house views on gold, which are mostly predicated on the long and bumpy road to economic recovery.
“But the next couple of weeks may tell us much about how the rest of the pandemic develops.
“Gold is still very well bid as the US remains mired amid crises, a health crisis, and a political crisis. The intense polarization of US political life and the outbreak of racial friction is making the implementation of a consistent and wide-sweeping health care policy difficult.
“Sure, a vaccine would be the ultimate salvation, but by current indications and in the absence of one, it will take longer for the US to fight off the virus than other developed economies.
Although the precious metal possesses some upside, with the present market volatility on-going, coupled with the resurgence of COVID-19 cases around the world prompting the World Health Organization to issue a stern warning yesterday, that reinstatement of lockdown measures could be required in some geopolitical zones