COMMODITIES: Gold Rises To Highest In More Than Seven Years On Lower Dollar, Fed Action
02:14 PM EDT, 04/09/2020 (MT Newswires) -- Gold prices rose to the highest since October, 2012, on Thursday, even as stocks rose, as the U.S. dollar fell after new initial jobless claims topped six-million for a second-straight week and the Federal Reserve introduced new measures to support state and local governments.
Gold for June delivery rose US$$68.50 to settle at US$1,752,80 per ounce in Comex trade.
Jobless claims in the United States fell by 261,000 last week but still came in a 6.61 million, as quarantines spread and shutter factories and businesses. Canada also shed more than a million jobs in March.
Stock markets in Europe and Asia were mostly higher and futures point to a higher open on U.S. markets despite the pessimistic unemployment figures. Usually, rising risk appetites are bearish for gold, but the metal is bucking its usual behaviour.
"Gold is not behaving like a conventional safe haven at present, but is gaining despite growing risk appetite ... The S&P 500 has reversed all of the losses it had chalked up since mid-March. The optimism is being fed by hopes that the worst of the corona crisis may be over," Commerzbank analyst Carsten Fritsch said in a research note.
The Federal Reserve introduced new measures to support state and local governments as well as smaller businesses, provided US$2.3 trillion in additional support.
The U.S. dollar weakened, making gold more affordable for international buyers. The ICE dollar index was last seen down 0.7 points to 99.42.
Cheers to the patient investors