By Barani Krishnan
Investing.com – Gold returned to mid-$1,600 levels on Tuesday as an emergency rate cut by the Federal Reserve and worry that U.S. cases of the coronavirus had crossed the triple-digit mark drove demand for the safe haven.
An underwhelming commitment from the Group of Seven nations toward fixing the economic carnage caused by the epidemic — with policy makers promising a monetary and fiscal response where appropriate — also worked against risk assets while helping gold.
“It's long been argued that governments aren't doing enough and clearly have a different definition of what's appropriate,” said Craig Erlam at online trading platform OANDA.
Gold futures for April delivery on New York’s COMEX settled up $49.60, or 3.1%, at $1,644.40 per ounce.
April gold crossed the $1,650 mark earlier, hitting a session high of $1,650.40, after the Fed announced a half-point rate cut ahead of its March 18 meeting in a move designed to bolster economic confidence amid the coronavirus impact. Rate cuts weaken the dollar and push investors toward assets seen as a better store of value, such as gold.
Adding to gold’s rally was New York Governor Andrew Cuomo’s announcement that the state had its second confirmed coronavirus infection that brought the total number of cases in the country to beyond 100.
Aside from the futures market for gold, the {68|spot price}}, which tracks live trades in bullion, was up $46.02, or 2.9%, at $1,636.45.
The coronavirus has killed more than 3,100 people worldwide and infected another 90,000-plus.