Fed-fuelled rally mounts precious gold futures to one-month-peak; Dollar dented

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Fed-fuelled rally mounts precious gold futures to one-month-peak; Dollar dented

On Thursday, the 9th of April 2020, the precious US spot gold futures’ prices had surged more than 2.5 per cent to wrap up the day at $1686.86 an ounce as the US Fed’s mammothlike $2.3 trillion in fresh aid package had begun to disentangle a deeply recessed US economy.

In point of fact, Thursday’s (April 9th) gold futures’ prices rally seemed to be catalysed by a record US initial jobless claims last week that reported another six million people had filed for the unemployment benefits, remarking a stark total of 16.6 million US initial jobless claims over the past three weeks and spurring up hopes of further monetary stimulus, which in effect had revived the safe-haven appeal of the precious metal.

Meanwhile, referring to possibilities of another stimulus in a near-term outlook as initial jobless claims were expected to reach 20 million a week as early as this month amid a stiffer forced lockdown measure, a head of base and precious metals derivatives trading at BMO, Tai Wong said on Thursday’s (April 9th) market closure, “The Fed unveiled yet another howitzer from its arsenal offering substantial relief to small and medium sized businesses as well as municipalities.

Gold’s rallying because this monetary largesse will eventually have to be repaid and that payment may come as sudden higher inflation somewhere down the road. ” Citing statistics, on Thursday’s (April 9th), the spot gold futures’ prices had wrapped up the day 2.5 per cent higher to $1686.86 an ounce as beforemtioned after hitting an intra-session high of $1,690.03 an ounce, the precious safe-haven metal’s highest level since March 9th.

Besides, as the gold futures had risen more than 4.2 per cent this week and the US gold futures’ prices had climbed 4.1 per cent to $1,752.80 on Thursday’s (April 9th) market wind down, the US Dollar index (DXY) measured against a basket of six major currencies on an average had ended up the day down by 0.61 per cent to 99.51.