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PRECIOUS-Gold supported by rising COVID-19 cases after vaccine hit

Published 13/11/2020, 03:01 pm
© Reuters.
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* Spot gold down 3.7% for the week

* Silver down 5% for the week

* Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa (Recasts, adds quotes, updates prices)

By Eileen Soreng

Nov 13 (Reuters) - Although fears over the economic fallout from mounting COVID-19 cases supported prices on Friday, gold was headed for its biggest weekly loss since September after positive news about a potential vaccine.

Spot gold XAU= rose 0.2% to $1,879.20 per ounce by 0814 GMT, but was down 3.7% for the week.

U.S. gold futures GCv1 gained 0.3% to $1,878.20.

Gold slumped 4.6% on Monday after Pfizer (NYSE:PFE) PFE.N said its experimental COVID-19 vaccine was over 90% effective based on initial trial results. may also be wary of other companies announcing trial data in the coming weeks, which if successful, could put more downward pressure on gold," Jeffrey Halley, senior market analyst at OANDA, adding, gold will struggle to reclaim $1,900.

The vaccine optimism has been tempered by spike in cases in the U.S. and Europe. Man Capital Markets analyst Edward Meir said people were realising that a significant roll-out of a vaccine will take time, while the need for relief is immediate.

A Reuters tally showed novel coronavirus cases soared by more than 100% in 13 U.S. states in the past two weeks, while the global tally crossed 52.45 million, underpinning the need for more stimulus. Democrats in the U.S. Congress urged renewed talks over a multi-trillion dollar aid proposal, but a top Republican immediately rejected this as too expensive. fact that there isn't a stimulus coming seems to be keeping a lid on it (gold)... If Congress actually comes up with a limited package, that would be beneficial," Meir added.

Gold tends to benefit from stimulus measures from central banks as it is considered a hedge against inflation and currency debasement, which has driven a rise of about 24% this year.

Silver XAG= rose 0.4% to $24.32. Platinum XPT= was up 1% at $888.30, while palladium XPD= was 0.5% higher at $2,343.84.

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