Gold pares weekly losses after weaker dollar brings relief
SINGAPORE – Bullion got a reprieve Friday as the dollar halted its rally, although the metal remains poised for a back-to-back weekly loss.
Gold headed for its biggest daily gain since March 3 and silver earlier jumped the most since 2014. Precious metals are rebounding after days of relentless selling by investors seeking liquidity to navigate the extreme volatility shaking global markets. Stocks and bonds also climbed as investors assess expanding measures defend economies against the coronavirus fallout.
“This is definitely a sigh of relief for markets,” Simon Harvey, a foreign-exchange market analyst at Monex Europe, told Bloomberg Television. Still, liquidity issues will continue to create upward pressure on the dollar, he said. “In this market nothing is taken for given, you have to take every day as it comes.”
Bullion typically moves inversely to the U.S. currency, which surged to a record this week, with gold taking a back seat to the greenback as the preferred haven.
The metal was trading 2.6% higher at $1 509.88.51 by 11:15 a.m. in London, still heading for a weekly decline after an 8.6% fall last week, the most since 1983.
Other precious metals also advanced, with silver trading at $12.7949 an ounce after jumping as much as 7.5%, the most since December 2014. Silver has been hard hit by the global sell-off, but there are some signs that sentiment is turning, with exchange-traded funds buying the metal in the past two days.
“When I think about what would I buy in the right here and now, I would be buying gold,” Wayne Gordon, executive director for commodities and foreign exchange at UBS Group AG’s wealth-management unit, told Bloomberg TV. Prices may appreciate over three to six months, he said.
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