Gold Futures Rise Again, Settle At Over 7-1/2-year High
Gold prices moved higher on Tuesday, extending recent gains, as traders continued to seek the safe-haven commodity.
Prices of the yellow metal rose as the dollar weakened and concerns about U.S.-China trade deal resurfaced following comments from White House trade adviser Peter Navarro about China’s failure to warn the U.S. about the coronavirus outbreak.
There are signs of economic recovery in the wake of several massive stimulus measures ushered in by global central banks and governments. However, warnings from various institutions such as the World Bank, the IMF and the Federal Reserve that it would take a long time for the economy to be well and truly back on track due to the virus outbreak, continue to prompt investors to seek the safe-haven asset.
The dollar index, which dropped to a low of 96.39, recovered some lost ground subsequently, but was still languishing in red at 96.64, down 0.4% from previous close.
Gold futures for August ended up $15.60 or about 0.8% at $1,782.00 an ounce, the highest close since early October 2012.
Silver futures for July gained $0.160 or 0.9% to $18.063 an ounce, while Copper futures for July settled at $2.6585 per pound, gaining $0.0060 or 0.2%.
In U.S. economic news, data from the Commerce Department showed new home sales showed a substantial increase in the month of May. The data said new home sales spiked by 16.6% to an annual rate of 676,000 in May from a significantly downwardly revised rate of 580,000 in April.
Economists had expected new home sales to jump 2.7% to an annual rate of 640,000 from the 623,000 originally reported for the previous month.
Gold prices inched higher on Tuesday and the dollar fell slightly as investors react to mixed messages from White House trade adviser Peter Navarro on the Phase 1 U.S.-China trade deal.
Peter Navarro clarified that his earlier remarks about China’s failure to warn the U.S. about the cornoavirus outbreak were “taken widely out of context.” He said, the comments “had nothing at all to do with the Phase I trade deal, which continues in place. I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world.”
Trump also sought to reassure investors with a post on Twitter declaring the trade deal is “fully intact” and saying he hopes China will “continue to live up to the terms of the Agreement!”
Also, a number of states in the U.S. continued to report a rise in new virus cases and hospitalizations, helping boost the precious metal’s safe-haven appeal.