Gold Recovering From a 5-Month Low as The Spread of Covid-19 Threatens Economic Recovery

Gold prices rose on Tuesday, December 1, after heavy selling that pushed it to its lowest level in nearly five months in the previous session, to renewed interest in the yellow metal, which represents a safe haven in light of the high number of cases of Covid-19, which blurred the economic prospects.

Spot gold rose 0.5% to $ 1785.10 an ounce by 06:25 GMT. And US gold futures gained 0.4% to $ 1788.50.

The precious metal recorded its worst monthly decline in four years on Monday, falling to $ 1764.29 an ounce, the lowest level since July 2.

Asian stocks gained thanks to the increased chances of launching a vaccine for Covid-19, while some Americans are likely to receive the vaccine before Christmas.

But virus cases exceeded 1.1 million in the United States last week, while California is considering new restrictions such as issuing orders to stay at home, which darkens the economic outlook.

Investors ’focus is now shifting to a testimony that US Federal Reserve Chairman Jerome Powell will give to the Senate Banking Committee later today, which will provide indications of the direction of monetary policy.

Gold that yields no return is seen as a hedge against inflation likely resulting from big stimulus measures.

As for the other precious metals, silver rose 1.1% to $ 22.85 an ounce, while platinum rose 1.7% to $ 981.37 and palladium gained 0.6% to $ 2387.70.