Good morning traders,

Prices for the precious metal, gold, closed at 1,861.99, after placing a high of 1,965.58, and a low of 1,850.44. The gold prices dropped more than 5% in a single day, to below the 1,900 level, after the news of the first successful late-stage COVID-19 vaccine trials that prevented more than 90% of infections.

Prices for the precious metal posted the biggest daily decline in over seven years, as investors started to dump safe-haven bullion and move to riskier assets. The reason behind this was the potential recovery of the global economy from the pandemic, along with the dimmed hopes for additional stimulus.

The equities rose after Pfizer Inc. said that its experimental COVID-19 vaccine was more than 90% effective. Pfizer and its German partner, BioNtech SE, said they expect to seek US emergency use authorization later this month.

The optimism that the release of a vaccine is imminent may slow or diminish further stimulus measures to support economies damaged by shutdowns in efforts to stop the spread of the pandemic. The gold price lost all of its US election gains, triggered by the hopes of further stimulus. The precious metal reversed after the optimism triggered by the vaccine news, and as the hopes of further stimulus faded away.

Cleveland Federal Reserve Bank President Loretta Mester said on Monday that the emergency lending programs set up by the Fed during the coronavirus pandemic had eased distress in financial markets, and they are still needed. Mester also said that Fed Chair Jerome Powell would be working with the Treasury Department to determine whether the programs should be extended beyond the end of the year. She added that the Fed is not out of ammunition when it comes to stimulating the economy, and that it could provide more assistance by adjusting its asset purchase program and implementing other tools.

She stated that the economy had rebounded more strongly than expected, but gains have not been evenly spread. Despite the optimistic news from Pfizer and BioNtech on Monday, regarding their coronavirus vaccine, Mester said that she thinks economic growth will be slower going forward.

The gold prices kept moving in a downward direction on Monday, following Mesters comments, plunging to its lowest level since August.