Gold is heading for a third weekly advance, with the haven metal gaining on anxiety about the spread of Covid-19 variants and the prospect of prolonged dovish monetary policy.
Bullion is winning back investors after a bleak June, with fears that the world’s exit from the pandemic may be more fraught than anticipated. Renewed virus fears around the world are a boon for bullion because they may mean governments must extend monetary support to still-fragile economies.
Those risks were underscored this week by Federal Reserve minutes that highlighted continued uncertainties, and on Thursday by a rise in US jobless claims. China’s surprise hint that it could unleash more liquidity to the economy also added to the sense that headwinds to a global recovery remain strong.
“Commodities came under pressure as policy makers around the world flagged risk to their economies from rising cases of Covid-19 variants,” Australia & New Zealand Banking Group Ltd. said in a note. “Demand for safe haven assets rose following a lift in US initial jobless claims.”
Gold was little changed at $1 800.65 an ounce by 6:58 a.m. in London, for a 0.8% gain so far this week. Silver, palladium and platinum fell.
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