Gold Jumps 6% as Its Safe-Haven Appeal Returns
By Barani Krishnan
Investing.com - Gold jumped 6% on Monday, regaining some of its safe-haven appeal and returning to the $1,500 berth, as investors built long positions in the yellow metal again as stocks on Wall Street avoided another major meltdown on recession worries.
“Yes, stocks are down but they aren’t any circuit breakers tripped or new margin calls being triggered, so gold has survived a liquidation and is gaining a bid again on recession worries,” said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
Gold futures for April delivery on New York’s COMEX rose $83, or 5.6%, to settle at $1,567.60 per ounce.
Spot gold, which tracks live trades in bullion, was up $52.57, or 3.5%, at $1,551.64 by 3:26 PM ET (17:26 GMT).
Gold is traditionally an asset investors run to in times of trouble, but has had trouble rallying amid the current stocks-to-credit markets crunch.
Monday’s run-up in gold came as Republican senators on President Donald Trump’s side and rival Democrats sparred in the Senate over what should go into a $2 trillion stimulus package.
The two sides reached broad agreement last week to provide help for both businesses and families, as large swathes of the U.S. economy were shut to break the spread of the contagion.
The IMF, meanwhile, warned that the pandemic could leave the world with a recession as bad as the 2008-09 financial crisis.