Gold prices hit their highest level in more than a week on Tuesday, as rising delta infections raised concerns about their impact on the pace of economic recovery, leading investors towards safe-haven assets.
Spot gold rose 0.2 percent to $1,791.55 an ounce by 0655 GMT, after hitting a peak since August 6 at $1,792.83. US gold futures rose 0.2% to $1,793.
An increase in coronavirus infections in the United States and China, and prospects of slowing global growth in the second half of the year will support gold prices, Kunal Shah at Nirmal Bang Commodities Trading Commodities in Mumbai said. “I expect gold to touch $1,850 this year,” he added.
Recent data showed a sharp drop in US consumer confidence and a more-than-expected fall in the New York Federal Reserve’s Empire State Manufacturing Activity Index, easing some concerns of an early tightening of policies by the Federal Reserve.
Monday’s data showed that growth in China’s factory production and retail sales slowed sharply in July amid new outbreaks of COVID-19, adding to indications that the country’s economic recovery is losing momentum.
The focus now is on the US retail sales data due later today, as well as the minutes of the US central bank meeting in July, which is scheduled to be published tomorrow, Wednesday, to elicit indications about the Fed cutting stimulus.
Meanwhile, the US dollar, which is usually considered a safe haven currency, gained 0.1 percent.
As for other precious metals, silver rose 0.2 percent to $23.86 an ounce, after hitting its highest level since August 9 at $23.95.
Platinum fell 0.6 percent to $1016.13, while palladium fell 0.9 percent to $2,582.96.