Gold jumped toward its peak last month, when prices hit the highest since 2012, after bleak US government data underscored how hard coronavirus-related shutdowns have hit the world’s largest economy.
Futures posted the highest close to a week since October 2012 after US factory production plummeted last month by the most in records back to 1919, and a gauge of US retail sales plunged through the record set just a month earlier.
“Everybody must have realized it, but it’s just more evidence that the reality is this is a pretty bleak economic picture right now,” Phil Streible, chief market strategist for Blue Line Futures LLC, said by telephone. “People are continuing to pile into gold, because that weak economic picture is going to continue to drive interest rates lower.”
Gold futures for June delivery settled 0.9 percent higher at US$1,756.30 an ounce on the Comex in New York, after climbing as much as 1.2 percent. The contract rose 2.5 percent this week.
Spot prices topped their 52-week high, posting the highest close since November 2012.
Silver also got a stronger bid, rallying to the highest in more than two months.
The two precious metals have been lifted after US Federal Reserve Chairman Jerome Powell warned this week that the pandemic would take a heavy toll on the US economy.
Fears intensified on gloomy US unemployment data on Thursday, and as US President Donald Trump said he does not want to talk to Chinese President Xi Jinping (習近平) right now.
Nations that enjoyed success quelling the virus, including South Korea and China, now face a rising number of infections.
In the US, Texas saw its deadliest day and its biggest jump in new cases since the start of the outbreak. That came two weeks after controversial moves to reopen the state’s economy.
“There are fears over everything from political leadership through the health outlook overall and associated economic financial and political risk,” said Rhona O’Connell, head of market analysis for Europe, the Middle East, Africa and Asia at INTL FCStone.
Prices are having a long-awaited breakout moment as market anxiety mounts, she said.
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