By Geoffrey Smith
By Geoffrey Smith
Investing.com — Gold prices rose on Thursday as world markets moved sharply into risk-off mode in response to a big upward revision in the number of Covid-19 cases and fatalities.
The Chinese authorities revised their estimate of confirmed Covid-19 cases up by one-third to just under 600,000, while adding some 250 to the official death toll. The Communist Party also fired its top officials in Wuhan, and in the surrounding region of Hubei, in response to local anger at their handling of the outbreak.
Outside of China, the virus continued to ripple through daily life with growing visibility: the world’s biggest telecoms conference in Barcelona was canceled due to contagion fears, while Japan recorded its first death from the disease.
By 11:12 AM ET (1612 GMT), for delivery on the Comex exchange were up 0.4% at $1,577.75 a troy ounce, having failed to make much progress beyond the $1,580 mark that has been the upper limit of the recent range. was up 0.6% at $1,575.08.
Elsewhere, were up 0.9% at $17.65 an ounce, while platinum was up 0.9% at $975.60.
The general risk-off move was also reflected in government bond yields, which fell by between 1 and 2 basis points along the curve in the U.S. and as much as 3 basis points in the euro zone.
Bloomberg cited European Central Bank Chief Economist Philip Lane as saying that the eurozone economy could face a “pretty serious short-term hit”, but the European Commission left its growth forecasts for this year and next year unchanged, despite growing unease about the collapse in industrial production at the end of 2019.
Kristalina Georgieva, the managing director of the International Monetary Fund, had said in an interview late Wednesday that she expects the Chinese economy to experience a “v-shaped” recovery, with a robust and quick rebound after an inevitable hit to first-quarter growth.
On an otherwise quiet day for economic data, on which U.S. consumer inflation figures came in largely as expected, the Bank of Mexico will decide later whether to join the growing ranks of emerging central banks to cut interest rates to offset the slowdown emanating from China. Banxico has cut its key rate at each of the last four policy meetings, but that hasn’t stopped the peso hitting its highest level in 15 months against the dollar – in sharp contrast to most emerging currencies.
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