Gold rises in Europe

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Gold prices edged higher on Monday after an extension of restrictions in the United States exacerbated concerns about the economic toll of the coronavirus pandemic and prompted to sought safe-haven assets.
Spot gold rose 0.2% at $1,621 an ounce by 11:09 a.m. EDT (1509 GMT). US edged 0.1% higher to $1,627 an ounce. The metal is on track for a 6.8% quarterly rise – its sixth gain in a row – and set to end the volatile month 2.2% higher.
“Gold is finally starting to shake its recent mantle as a risk asset and becoming more of a haven asset again, especially with the extension of national social-distancing controls through April 30,” said Tai Wong, head of base and precious derivatives trading at BMO. “$1,600-$1,610 is solid technical support and has held resolutely which has also helped.”
US stocks opened higher as President Donald Trump followed last week’s massive fiscal stimulus package by extending his stay-at-home guidelines. The US Congress last week approved a $2.2 trillion aid package – the largest on record – to help cope with the virus-inflicted economic downturn.
Lower interest rates and looser economic policy tend to benefit gold because they cut the opportunity cost of holding non-yielding assets. The pandemic has paralysed economies worldwide.
The coronavirus has already driven the global economy into recession and countries must respond with “very massive” spending to avoid a cascade of bankruptcies and emerging market debt defaults, the head of the International Monetary Fund said on Friday.
“Traders and investors are entering another week (in)uncertainty, as the mood of the marketplace has turned from panic to gloom,” Kitco Metals senior analyst Jim Wyckoff said in a note. The dollar index rose against rivals, making gold for holders of other currencies.
Among other metals, palladium fell 0.2% to $2,265.58 an ounce, dropped 2.4% to $723.82 an ounce and silver slipped 2.7% to $14.09 an ounce. The world’s largest producers Anglo American , Sibanye Stillwater and Impala have declared force majeure on contracts after a three-week national lockdown in forced operations to close.
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