Gold on Fire, Touches New Record High
Gold prices continue their upward climb, touching a new record high in early trading on Friday, boosted by a weakness in the US dollar as well as a fall in US Treasury yields. At the time of writing, GOLD is trading at a little above $2,057.
Gold is all set to post a weekly gain for the ninth straight week so far, supported by ongoing worries about the economic fallout from the coronavirus pandemic. Over the past few sessions, the demand for gold has also been boosted after the US dollar, which shares a negative correlation with the yellow metal, fell to two-year lows amid worries about a delay in economic recovery in the US.
Meanwhile, the 10-year US Treasury yields also declined to the lowest levels seen since five months, driving the opportunity cost of holding non-interest bearing gold lower and making it more attractive as an instrument to invest in. The safe haven appeal of the precious metal remains in the spotlight amid the coronavirus pandemic, with cases continuing to rise despite numerous lockdown measures implemented by governments worldwide.
Gold is also enjoying support from the prolonged uncertainty surrounding the coronavirus relief bill in the US. Congress has been unable to come to an agreement on the next round of stimulus measures needed to support the US economy, raising fears that economic recovery could come under more strain as a result.
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