Gold at US$2,000 'a matter of time'

Gold traded near an eight-week high as a surge in global coronavirus infections and curbs stoked demand for the haven asset, which has been supported by lower U.S. real yields, a weaker dollar, and slumping equities, Bloomberg reports.

Gold’s climb builds on the biggest annual gain in a decade, as virus angst clouds the outlook for the recovery. The spread of the virus throughout the festive period and tighter restrictions will have a significant toll on the economy, albeit one that’s consigned mostly to the first quarter thanks to vaccines, according to Craig Erlam, senior market analyst at Oanda Corp.

“Gold burst through US$1,900 to start the year, with a softer dollar giving the yellow metal the kick it craved,” said Erlam. Following its move toward US$1,945, and with the outlook for the dollar looking no better, “another run at US$2,000 suddenly looks a matter of time,” he said.

Spot gold gained by 0.1 percent US$1,945.67 an ounce, the highest since November 9, and traded at US$1,940.60 at 12:10 p.m. in Singapore. The metal surged by 2.3 percent on Monday, the most in two months.

Platinum lost 0.4 percent after hitting US$1,131.62 an ounce on Monday, the highest since 2016. Silver and palladium gained.