Good morning traders,

Prices for the precious metal, GOLD, closed at 1,888.73, after placing a high of 1,899.06, and a low of 1864.49. GOLD prices remained steady on Monday, as they fell in the early session, and in the late trading sessions, the prices for the yellow metal started to rise, on the back of the weak US dollar, due to the global COVID-19 news.

During the early trading session, another drugmaker, named Moderna, announced effective vaccine test results, becoming the second company after Pfizer to do so. This again weighed on the GOLD prices, which fell about 1% in the early session on Monday, but after some time, GOLD recovered all of its daily gains and started posting gains after the comeback of its safe-haven status.

Moderna said that its experimental vaccine was 94.5% effective in preventing a coronavirus infection, after Pfizer announced that its vaccine was over 90% effective last Monday. Although the vaccine news was very encouraging, deploying it in even the developed countries will be difficult. This weighed on market sentiment and added gains in bullion.

The coronavirus pandemic is still strengthening, with European and the US case numbers being of particular concern. GOLD prices were on the rise on Monday, after retreating last week, due to the optimism spread by the news of the efficiency of the latest coronavirus vaccine. Pfizer and BioNtech announced, last Monday, that their coronavirus vaccine had proven more than 90% effective, and this news raised the risk sentiment in the market, making safe-haven bullion weak. However, the optimism faded from the market after the grim realization dawned, that there would be technical difficulties in delivering the vaccine, as it will require storage and transport temperatures of -70C to be viable.

There is also a lack of information on just how long the immunity will last, and this data will only be obtained after the vaccine comes into circulation. These uncertainties about the availability and usage of vaccines once again raised the demand for the precious metal, and as a result, GOLD prices started to rise again. Furthermore, GOLD prices were supported by the inexorably rising numbers of coronavirus cases worldwide, with over 54 million cases globally. Over 11 million of the total global cases are from the United States alone, with the daily numbers of new cases in the US having reached a new high of 177,000, while Europe has also been hard hit. The rising number of cases increased the demand for safe-haven assets, which in turn, has pushed the GOLD prices higher.

With the increased number of coronavirus cases all over the world, the chances for a larger stimulus package in the US also increased after Joe Biden’s recent victory in the US Presidential elections. This means there are chances that the US dollar will weaken in the coming days, and that is also what supported the gold prices on Monday. On the data front, the Empire State Manufacturing Index for November dropped to 6.3, against the expected 13.8, weighing on the US dollar and adding further gains to the GOLD prices.