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Gold off 1-month peak as investors speculate pandemic recovery
Gold prices declined after rising to a more than 1-month high in the previous session on increasing coronavirus cases around the world. The drop in the safe-haven metal comes in as investors focused on the prospect for an eventual economic recovery from the coronavirus pandemic.
Spot gold was trading 0.2 percent down to $1,751.70 per ounce by 0731 GMT, having touched a high of $1,763.30 on Monday, its highest since May 18. U.S. gold futures edged 0.1 percent lower to $1,767.10 per ounce.
On Monday, Beijing reported its second straight day of record COVID-19 infections, while new cases and hospitalisations in record numbers rose through more U.S. states, especially in Latin America. Although risk sentiment somewhat improved as some cities in North America, such as New York and Toronto, eased lockdowns and reopened their economies.
The U.S. President Donald Trump provided assurance that the Phase 1 trade deal struck with China in January was fully intact, cooling market concerns that Washington may be dumping the agreement.
Earlier in the Asian session, White House trade adviser Peter Navarro said the trade deal with China was over, linking the breakdown in part to Beijing not sounding the alarm earlier about the coronavirus outbreak. However, sentiment improved after a statement from Navarro that his comment had been taken out of context.
The greenback against a basket of currencies traded up at 96.99, having touched a high of 97.74 on Monday, its highest since June 2. The U.S. Treasury yields edged up, with the benchmark 10-year note yield trading at 0.713 percent, while the 2-year yield was at 0.199 percent.
Investors now await U.S. new home sales, Richmond Fed Manufacturing Index, Markit manufacturing and service PMI for further clues on the strength of the economy.