By Adam Claringbull
Investing.com – Gold was up on Friday morning in Asia, with the markets digesting potential hiccups on the way to a global vaccination rollout providing a boost. However, increased risk-on appetite pushed prices in the opposite direction.
Gold futures inched up 0.09% at $1,807.20 by 11:58 PM ET (4:58 AM GMT), clearing the $1,800 mark. Trading volume was thin as major U.S. investors were absent from the market due to the Thanksgiving holiday.
Concerns over the global delivery of viable vaccination programs gave some upward impetus to gold prices, as some scientists expressed skepticism over how effective any such program was likely to be in the short-to-medium term. Outgoing U.S. President Trump has said a vaccine could be released publicly next week; however, current expectations are for the middle of December.
The transition of power between the Biden and Trump U.S. presidential administrations has now smoothed, reducing some of the uncertainty pushing safe-haven assets up. Global stocks markets have taken most of investor interest this week, with U.S. markets setting new record highs as risk-on appetite returned in a rush.
In a positive for gold, the European Central Bank’s chief economist Phillip Lane urged further economic stimulus for the euro zone.
“Tolerating a longer phase of even lower inflation ... than originally envisaged would be costly and risky,” Lane told an academic audience via weblink.
“First, it would imply a weaker recovery of consumption and investment, as a result of higher expected real interest rates. Second, it would contribute to a downward drift in inflation expectations that might become entrenched.”
The statement is a boost for gold, as lower interest rates and a weaker euro makes buying gold cheaper for currencies other than the euro. However, gold prices are more strongly influenced by moves in the greenback.