Oil’s bite was forgotten, worries about the pandemic continued and off went gold and other metals on Wednesday, the gloom of the previous two days forgotten for the moment
As a result Comex gold futures settled at their highest in a week, with continuing concerns about the global economy supporting more demand and a solid rise for goold well past $US1,700 a barrel.
It’s been there several times in the past couple of weeks and each time its retreated, so will this time be any different?
Wednesday’s rise came after a two week low on Tuesday.
Gold for June delivery rose $US50.50, or 3%, to settle at $US1,738.30 an ounce, the highest most-active contract finish since April 15, according to FactSet data. Prices lost 1.4% on Tuesday to mark the lowest close since April 8.
Analysts at Bank of America were upbeat on the outlook for gold prices, raising their 18-month price target to $US3,000 an ounce from $US2,000, or more than 50% above a nine-year-old record at around $US1,192.
The drivers they said would be the prospect of endless monetary expansion from central banks, including the Federal Reserve, to limit the economic damage from the COVID-19 pandemic.
Marketwatch.com said that based on records going back to November 1984, the record intraday level for most-active gold futures stands at $US1,923.70 an ounce on September 6, 2011, with the settlement record at $US1,891.90 from August 22, 2011.
Comex May silver meanwhile, jumped 45.9 cents, or 3.1%, at $US15.335 an ounce, following a 4.7% slide on Tuesday, May copper added 6.1 cents, or 2.7%, to trade at $US2.29 a pound after Tuesday’s 2.9% fall.
Iron ore prices steadied and edged higher on Wednesday in the calmer trading conditions. The price of 62% Fe fines delivered to northern China ended up 67 cents at $US85.04 a tonne.
