The precious metal recorded significant losses at the last trading session of the week as an improvement in the global economic outlook strengthened investors’ risk appetite.
At the time of writing this report, Gold futures plunged by 0.38% to $1,874.75 an ounce. The weaker greenback that often moves inversely to gold, inched down today, thereby capping the precious metal’s losses.
Gold bugs seem to be taking a wait-and-see approach amid solid economic reports from key international markets that include the Eurozone, the United Kingdom, and the United States, as investors increased their buying pressures on riskier assets like global equities.
U.S stocks, currently posting solid gains, were stronger amid the stabilization in crypto assets which further softened the demand for safe-haven assets, with fewer initial jobless claims recorded at the world’s largest economy.
Recent price action, however, suggests gold bugs are pretty much in play, with the bullion asst springing above $1,850 an ounce amid signs of inflationary pressures. Market experts envisage that a break above $1,900 an ounce is still in the works on the bias that the precious metal is supported by “irrational” behaviour in response to a COVID-19-stressed global economy that threatens the value of fiat currencies.
In addition, gold traders seem to keep some of their bullish bets amid the reality that postulates COVID-19 is still far from being under control, triggering a flocking back to the safe-haven asset, despite the significant progress that was made in the past few months, and several COVID-19 vaccines already in the market.
Peter Schiff, a popular gold investor via Twitter, discounted sentiment, stating Bitcoin is not a safe-haven, inflation hedge, or store of value asset similar to gold. He further revealed the flagship crypto is a highly speculative digital token that trades with other high-risk assets.