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PRECIOUS-Gold draws support from recovery worries after sharp sell-off

Published 20/08/2020, 11:21 am
© Reuters.
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Aug 20 (Reuters) - Gold recovered some poise on Thursday after the U.S. Federal Reserve warned that a recovery from the pandemic-induced economic slump faced a highly uncertain path.

FUNDAMENTALS

* Spot gold XAU= was up 0.5% at $1,940 per ounce by 0052 GMT, after declining more than 3.5% to a near one-week low on Wednesday.

* U.S. gold futures GCv1 fell 1.4% to $1,943 per ounce.

* Fed policymakers are considering tweaks to monetary policy that could result in the U.S. central bank sticking with aggressive stimulus measures far longer than under its previous rubric, minutes from their last policy meeting showed. More than 22.27 million people have been reported to be infected by the novel coronavirus globally and 781,162​ have died, according to a Reuters tally. Asian equities were set to follow Wall Street's late session retreat on Thursday. MKTS/GLOB

* The U.S. State Department said it notified Hong Kong on Wednesday that Washington has suspended or terminated three bilateral agreements with the semi-autonomous city following China's imposition of a sweeping national security law. Limiting gold's advance, the dollar index .DXY rose 0.2% after sharp gains in the previous session against its rivals, making gold expensive for holders of other currencies. USD/

* U.S. Treasury yields rose after the Fed threw a bucket of cold water on implementing yield curve control as a means of keeping the cost of borrowing low. US/

* Higher yields increase the opportunity cost of holding non-yielding assets such as bullion.

* Silver XAG= rose 0.8% to $26.94 per ounce, platinum XPT= climbed 0.3% to $934.01, and palladium XPD= gained 0.4% to $2,165.86.

DATA/EVENTS (GMT) 1230 US Initial Jobless Claims

Weekly 1230 US Philly Fed Business Indx Aug

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