Friday, December 9, 2022

Gold Rises on Poor U.S. Job Numbers, Rising COVID-19 Cases By


© Reuters.

By Adam Claringbull – Gold was up on Thursday morning in Asia, as investors looked to the save-haven asset on the back of weak U.S. jobs data, rising COVID-19 numbers, and as a hedge against a fall in stocks.

edged up 0.19% at $1,809 by 1:03 AM ET (5:03 AM GMT).

After recent falls on the back of promising COVID-19 vaccine news sending investors toward risk-positive assets, gold is back up as U.S. data highlights the ongoing reality of the coronavirus epidemic. Stocks reached record highs earlier in the week.

U.S. have risen for the second week running, with 778,000 claims filed, as opposed to the forecast 730,000. The numbers pulled back the optimism that had been fueling stocks and other risk-on investments, demonstrating that the effects of the COVID-19 pandemic are far from over yet.

The data clearly highlighted the divergence between positivity driven by the vaccine and the near-term COVID-19 issue,” Stephen Innes, chief global market strategist at financial services firm Axi, told Reuters, noting that the report also boosted the chances for further stimulus.

“The vaccine narrative has watered down gold’s appeal immensely and it will continue to do so until we finally move from a deflationary world into an inflationary world,” Innes added.

Global coronavirus numbers show no signs of slowing their growth at present, with cases worldwide past the 60 million mark, 12.77 million of them in the U.S alone, according to Johns Hopkins University data.

The U.S. Federal Reserve released the minutes from the latest Federal Open Market Committee meeting. Policymakers have been looking into ways to support the markets, with some analysts expecting the Fed to extend bond purchase maturation. This, combined with a weakening , is giving some support to gold, which is seen as a hedge against inflation.

“With the widespread distribution of a coronavirus vaccine unlikely before H2 2021, central banks are likely to remain accommodative,” ANZ analysts said in a note.

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