Gold prices Slip 2% as Recovery Hopes Bolster Risk Appetite – Gold Silver Reports (GSR)

Gold price fell more than 2 per cent on Wednesday as risk sentiment improved on hopes of a recovery from a coronavirus-driven economic slump, with investors largely overlooking civil unrest in the United States and its friction with China.

Spot gold slid 1.9 per cent to $1,693.83 per ounce by 11:00 a.m. EDT (1500 GMT), having earlier hit a near one-month low of $1,688.89.

US gold futures fell 2.2 per cent to $1,696.40.

Read More : Gold Technical Price Outlook – Below $1767 Target $1720——$1697, Sell on Rise – Neal Bhai

“There is a strong risk-on sentiment right now… US equity markets are breaking out,” said Phil Streible, chief market strategist at Blue Line Futures in Chicago.

US stocks opened higher as investors remained optimistic about an economic rebound, with world shares hitting three-month highs.

Sentiments were also bolstered by data showing US private payrolls fell less than expected in May, suggesting layoffs were abating as businesses reopen, though the overall economy’s recovery will be slow.

“Generally markets are getting comfortable with the fact that even though the data is bad, things are likely to improve and that’s taking the shine off gold,” said Michael Hewson, Chief Market Analyst at CMC Markets UK.

Despite the pullback, gold is expected to remain supported by a weaker dollar, widespread protests in the United States, souring US-China relations and massive stimulus measures, Hewson added.

Gold, considered a safe-haven investment, tends to gain on political and economic uncertainties.

The dollar index fell to a more than two-month low.

US protesters ignored curfews overnight as they vented their anger over the death of an unarmed black man at the hands of police, but there was a marked drop in the violence.

Holdings of SPDR Gold Trust gold-backed exchange-traded fund rose to 1,129.28 tonnes on Tuesday, their highest since April 2013.

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Neal Bhai has been involved in the Bullion and Metals markets since 1998 – he has experience in many areas of the market from researching to trading and has worked in Delhi, India. Mobile No. - 9899900589 and 9582247600

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