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PRECIOUS-Gold range-bound as vaccine cheer offsets pandemic resurgence

Published 11/17/2020, 10:47 PM
Updated 11/18/2020, 03:00 AM
© Reuters.
XAU/USD
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MRNA
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* Virus surge prompts restrictions in Europe, U.S.
* U.S. retail sales miss expectations in October
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

(Updates prices)
By Sumita Layek
Nov 17 (Reuters) - Gold inched down but held in a narrow
range on Tuesday, as a weaker dollar and concerns about mounting
coronavirus cases and their impact on the economy vied with
optimism about the race to deliver a vaccine.
Spot gold XAU= was down 0.2% at $1,884.91 per ounce by
01:47 p.m. EDT (1847 GMT). U.S. gold futures GCv1 settled 0.1%
lower at $1,885.10.
"There is a lack of conviction on the trajectory of safe
haven flows, we've all this vaccine optimism in place, but we
also have the U.S. and Europe still struggling with the
pandemic," said Edward Moya, senior market analyst at OANDA.
"Longer term trends are still supportive for gold to rally,
but we're seeing some investors kind of abandon their bullish
bets. The vaccine news for many has made holding gold longer
term less appealing."
Gold shed as much as 1.3% on Monday after Moderna MRNA.O
said its vaccine was 94.5% effective in preventing COVID-19 in a
late-stage trial, becoming the second U.S. drugmaker after
Pfizer PFE.N to report results that exceeded expectations.
Meanwhile, U.S. retail sales rose less than expected in
October and could slow further amid rising infections and new
restrictions. Limiting gold's losses, the dollar .DXY eased 0.3% against
rivals. USD/
"Gold is trapped in a range. It's limited on the upside,
$1,900 is the key level of resistance, and $1,850 is key
support," said Phillip Streible, chief market strategist at Blue
Line Futures in Chicago.
Gold will remain supported as "everyone believes that next
year inflation will run hot and the U.S. Federal Reserve will
not do anything about it," he added.
Bullion, considered a hedge against inflation and currency
debasement, has gained over 24% this year, mainly benefiting
from massive global stimulus. Silver XAG= fell 0.8% to $24.54 per ounce. Platinum XPT=
rose 0.4% to $929.33, while palladium XPD= shed 0.7% to
$2,317.72.

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