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PRECIOUS-Gold dips as AstraZeneca adds to vaccine optimism

Published 23/11/2020, 09:15 pm
© Reuters.
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(Adds analyst comment, updates prices)

* AstraZeneca says COVID-19 vaccine can be 90% effective

* Equities rally, dollar dips to near three-month low

* Interactive graphic tracking global spread of coronavirus: open

* https://tmsnrt.rs/3aIRuz7 in an external browser

By Asha Sistla

Nov 23 (Reuters) - Gold prices eased on Monday as drugmaker AstraZeneca AZN.L injected fresh optimism into the race for a COVID-19 vaccine, bolstering appetite for riskier assets and overshadowing support for bullion from a weaker dollar.

Spot gold XAU= had fallen 0.4% to $1,863.21 per ounce by 1328 GMT and U.S. gold futures GCv1 were 0.6% lower at $1,861.40.

Britain's AstraZeneca said its vaccine could be around 90% effective and will have as many as 200 million doses by the end of 2020. fact that we have three vaccine results that are extremely positive is keeping gold under pressure in the near term and also stopping it from any kind of significant rebound," said OANDA analyst Craig Erlam.

The positive vaccine developments prompted investors to bet on a quicker global economic recovery, driving equities higher. .EU

But bullion's losses were capped by a weaker U.S. dollar, which slipped to a near three-month low, making gold an attractive bet for those holding other currencies. USD/

"The expectation now is that there's an extremely strong chance that the ECB and Fed announce more stimulus measures in December in order to support these markets at a time when the COVID spread is getting quite severe and we're seeing lockdown restrictions," OANDA's Erlam said.

Non-yielding gold is often seen as a hedge against inflation that is likely to result from the unprecedented stimulus measures adopted globally this year.

"The only short-term potential trigger for a move higher (in gold) might be the announcement of a new Treasury Secretary by U.S. President-elect Joe Biden and restart of discussions about a second U.S. stimulus package," said Stephen Innes, chief global market strategist at financial services firm Axi, in a note. XAG= fell 0.6% to $24.00 an ounce, platinum XPT= dipped 0.6% to $940.00, while palladium XPD= was up 0.1% at $2,328.02.

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