Gold’s Safe Haven Appeal Supported, Delay in Economic Recovery Expected

The safe haven appeal of gold remains in focus, helping prices climb higher over renewed worries about a delay in economic recovery after

Gold's Safe Haven Appeal Supported, Delay in Economic Recovery Expected

Early on Monday, the safe haven appeal of gold remains in focus, helping prices climb higher over renewed worries about a delay in economic recovery after the coronavirus pandemic. At the time of writing, GOLD is trading at a little above $1,934.

While the NFP report which released on Friday showed an improvement in the jobless rate during August, the number of new jobs being created slowed down as well, indicating that economic recovery could take longer in the US. The Fed has already signaled its intentions to continue with low interest rates for an extended period of time, another factor that is supporting gold prices lately.

Markets expect other leading central banks to follow in the Fed’s footsteps and remain dovish for a longer period of time as the pandemic still rages on even as economies reopen around the world. Traders expect more stimulus measures to be rolled out by both central banks as well as governments as the pandemic-driven downturn extends into the current quarter as well.

However, gold’s gains remain under pressure as the US dollar trades steady close to a weekly high. Gold shares a negative correlation with the dollar, as a stronger dollar makes the yellow metal more expensive for holders of other currencies.

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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