Gold rises due to growing virus fears after US travel ban

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(Reuters) – Gold rose on Thursday due to concerns about the economic impact of the Corona virus, as the United States suspended travel from Europe hit by the virus, while palladium fell nearly 6 percent as the outbreak threatened demand for the metal used in self-stimulation.

Gold bars in an image from Reuters archive.

And gold rose in spot trading 0.5 percent to 1642.46 dollars an ounce (0800 GMT) by 0854 GMT. There was little change in the US gold futures contracts at $ 1642.20.

IJ Markets analyst Kyle Roda said the travel ban was “a big surprise and a huge shock to the market” and showed that investors had yet to see the full economic consequences of the Corona virus outbreak.

On the other side, Roda added, traders sell gold to fund margin positions, which inhibits the gains from the yellow metal.

US President Donald Trump announced on Wednesday the suspension of all travel from Europe, with the exception of the United Kingdom, to the United States for 30 days, which led to sales in global stock markets and the dollar.

But the precious metal trimmed some of the gains from a 0.9 percent jump earlier in a choppy session, and held steady well below the seven-year peak of $ 1702.56 on Monday.

On Wednesday, the World Health Organization described the Corona virus as a pandemic, with 119,100 people infected with the virus worldwide.

Central banks around the world have taken steps to protect their economies from spreading, while the Bank of England cut interest rates on Wednesday in its latest move. The Federal Reserve slashed interest rates in an emergency move last week.

The European Central Bank is expected to follow suit when it meets later on Thursday.

For other precious metals, palladium fell 3.2 percent to $ 2232.09, after falling as much as 5.9 percent to the lowest level in nearly two months.

The metal has fallen about 22 percent since it hit an all-time high of $ 2875.50 on February 22, as demand fears began to overshadow a sharp supply shortage of the metal.

Silver fell 0.4 percent to 16.69 dollars, while platinum fell 0.9 percent to 825.51 dollars.

Moataz Mohamed prepared for the Arab publication





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