Prices for gold decreased more than 1.5% on Friday as investors opted for riskier assets after news of U.S. President Donald Trump’s plans to re-start the U.S. economy and promising early data related to a potential COVID-19 treatment.
Spot gold was down 1.4% at $1,693.20 U.S. an ounce overnight, having this week scaled a seven-year peak on heightened worries over the worst recession in decades.
Global financial markets drew comfort from Trump’s plans for a gradual reopening of the U.S. economy, overshadowing concern over data showing China that suffered its worst quarterly economic contraction on record.
Also lifting risk sentiment, a report detailed encouraging partial data from trials of U.S. drugmaker Gilead Sciences Inc’s (NASDAQ:GILD) experimental drug remdesivir in severe COVID-19 patients.
The pandemic, which has infected more than two million people globally and killed more than 143,000, has battered economies and prompted central banks to roll out a wave of monetary support measures.
Gold tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation and currency debasement.
Considering other precious metals, palladium rose 1.1% to $2,176.35 U.S. an ounce, silver dipped 2.6% to $15.21 U.S. and platinum was down 1.5% at $771.81 U.S.
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