By Barani Krishnan
Investing.com – Gold dipped as investors rediscovered their appetite for risk amid plans by New York and Italy to reopen for business after the places worst hit by the coronavirus said they had passed the peak for infections and deaths from the pandemic.
“Easing lockdown measures are prompting hopes economic activity will start to gradually improve,” said Ed Moya, analyst at New York-based online trading platform OANDA.
for June delivery on New York’s COMEX settled down $ 11.80, or 0.7%, at $ 1,745 per ounce.
, which tracks live trades in bullion, was down $ 13.97, or 0.8%, at $ 1,714.89 by 4:40 PM ET (20:40 GMT).
Italy, the country worst impacted by the coronavirus before the United States, is looking to ease lockdowns from May 4 after an apparent peak in infections and deaths from the outbreak.
New York, the U.S. epicenter of the pandemic, is also looking to reopen parts of its economy, following at least a dozen of states that have relaxed measures.
News of the reopenings reduced investors’ appetite for safe havens and boosted risk assets such as stocks. Wall Street’s index responded by closing up 1.5%.
But with a host of key central bank meetings due this week — Bank of Japan’s on Tuesday, the Federal Reserve’s on Wednesday and the European Central Bank’s on Friday — analysts say gold could still see support from fresh stimulus measures.
“Rolling reopenings across the globe however will not be as smooth and investors are hoping, so the bullish case for gold should remain intact,” Moya said.
“Gold is finding formidable resistance around the $ 1760 region, but that might not last the deeper we get into the trading week,” he added. “This is a big earnings week for tech and energy results and a battered consumer along with uncertainty on when economic activity will return will prove difficult for companies to become overly optimistic.”
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