Gold sets its fresh record as observed in the course of four years. This was boosted by dollar shortcomings and low-interest rates. On the other hand, silver-headed for its best month since 1979 (Four decades).
In July, Spot bullion had over 10% increase, heading for its best month since 2016 as US real yields lingered near record lows. While the ferocity of rallies in both gold and silver cooled in the middle of the week, most market watchers predict there may be more gains ahead.
The potential fallouts that may further be caused by the coronavirus pandemic only fuel demand for havens and raise concerns. Gold and silver exchange-traded funds boosted holdings to a record, as both metals have added about 30% in 2020. The Federal Reserve this week repeated a vow to use all its tools to support the U.S. economy, with governments and central banks worldwide already unleashing vast amounts of stimulus to shore up growth.
TD Securities strategists including Bart Melek said in a research note. “After a brief consolidation period post-FOMC, speculation around President Trump’s call to delay the election shook the market and saw the yellow metal recovered. In addition to the sudden haven-type flows, poor economic data across the U.S. and Europe keep the hopes for further stimulus high, the dollar weak and real rates on a firm downtrend.”
President Donald Trump floated the idea of postponing the November election, after dismal economic data Thursday. The European GDP numbers also show an unprecedented slump in the second quarter. Yet, Chinese manufacturing figures indicate continued upward momentum in the recovery.
Spot gold rose as high as $1,983.36 an ounce Friday — a fresh record — and was trading up 0.7% at $1,970.66 as of 2:58 p.m. in New York. December Comex gold futures hit $2,005.40 before paring gains to settle 1% higher at $1,985.90 an ounce. Spot silver advanced 2.9% to $24.18 an ounce after a three-day pause in its rally.
Gold traders on Thursday declared their intent to deliver 3.3 million ounces against the August Comex contract.
With more stimulus on the horizon, Goldman Sachs Group Inc. has said that gold is the currency of last resort amid an inflation threat to the dollar.

Read EquityPandit’s Nifty Outlook for the Week