Wishful thinking. That’s how Angel Gurría, secretary general of the Organisation for Economic Co-operation and Development (OECD), responded to any prospect of a swift economic recovery from the coronavirus pandemic. But the scale of the impact on the global economy – as well as our daily lives – has been matched by the scale of the financial response.
Goldhub blog: Posts from March 2020
The domestic gold price increased by 4.1% in February m-o-m and 8.4% higher than the end of 2019. The rising gold price and higher volatility in the market lured investors towards gold ETFs.
The coronavirus (COVID-19) outbreak supported demand for gold as a safe-haven asset as stocks and commodities fell sharply. Physical gold demand faltered domestically due to COVID-19 and seasonality factors.
There is an aspect to gold’s role in our society which tends to receive much less attention: it is a critical component in many diagnostic test kits.
Heavy selling has been seen across all four precious metals this morning. Gold has dropped $50/oz and is now trading around $1477/oz.
The break of the 200 day moving average - at about $1500/oz - seems to have triggered stop-loss selling.
RSI now oversold FWIW. https://t.co/Db5oDuRYaS
This week, we launched our February 2020 ETF flows report, which highlights the positive impact current market volatility is having on investment flows in gold-backed ETFs.
The US Federal Reserve (Fed) announced an emergency 50bp rate cut yesterday, bringing the Fed funds rate down to a 1-1.25% range, in response to ongoing concerns about the potential impact of the coronavirus outbreak to the global economy. Treasury bond rates followed suit, with the 10-year note hovering 1% at the time of writing – an all-time historical low
The stock market embraced the weakest one-week performance since the financial crisis last week on the back of growing concerns of the continued spread of the coronavirus across the globe. Despite the risk off-moves, gold was lower by more than 3% last week, which is historically unusual during these types of movements. There are a few potential reasons for the weakness.