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flag ★ Gold's growth rate slows down, undergoes correction

Analysis News:::2020-11-23T10:34:50

Gold's growth rate slows down, undergoes correction

Gold's growth rate slows down, undergoes correction

Gold prices exhibited a negative trend on Monday morning, which, however, is not as serious as it may seem at first glance. Market participants closely evaluate opportunities for the recovery of the global economy if a vaccine against coronavirus infection enters the market. The rate of its emergence for widespread use is also estimated.

The price of gold futures contracts for December delivery on the electronic trading floor in New York fell slightly by 0.03% or 0.55%. This sent it to $1,871.85 per troy ounce.

Silver futures contracts for December delivery also went down by 0.19%, and the current value is consolidating around $24.32 per troy ounce.

Investors began to feel some positive about the successful trials and advances in the development and market launch of a vaccine against coronavirus infection. However, not everyone is ready to believe that the drug can quickly change the difficult situation with the growth of COVID-19 infection. Earlier, the company Moderna, which is engaged in biotechnological developments, announced that the effectiveness of its vaccine is at 94.5%. Before that, there was also news about another drug, which is a joint development of the American company Pfizer and the German BioNTech. According to the data, the effectiveness of this vaccine was announced in the region of 90%, and then it was refined and increased to 95%. Of course, investors could not help but react to such news, since the coronavirus pandemic and its consequences are now the main driving factors of the market. However, the initial enthusiasm was somewhat diminished after an expert assessment of the timing of the introduction of a widely available coronavirus vaccine was carried out. Most likely, this will happen no earlier than in a few months.

But the epidemiological situation in the world continues to worsen every day. It is this fact that keeps precious metals from falling rapidly against the background of the appearance of the vaccine. The rapid growth of infection in the world as a whole and in certain regions, in particular, does not give reason to relax. In a number of countries, anti-records are observed almost every day. One of the most difficult situations is developing in the US, which was significantly affected during the first spring wave, and now the situation is even more heated. According to statistics from Johns Hopkins University, the number of new cases of coronavirus infection over the past week exceeded 1 million. Thus, the total number of cases is already more than 12 million. The daily increase continues above 100,000. Of course, the seriousness of the situation cannot but make investors think about when and how the vaccine being developed will begin to change the current state of affairs.

Of course, the current negative movement of gold in the market is corrective in nature and will not last long, because there are too many problems, and the safety of assets of market participants is still a topical issue.

One way or another, the US dollar acts as additional support for the precious metal, which has recently shown a significant weakening of its exchange rate, which traditionally returns traders to a "safe haven". Recall that if the dollar becomes more expensive, the cost of gold for holders of foreign currency also increases.

Analyst InstaForex
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