Gold Prices Dropped 1% – Investors Turn to Riskier Assets

Gold prices fell 1 % on Tuesday, in decline since the metal’s rise of over US $ 1,700. Hopes of global stimulus measures to contain the economic impact of the COVID-19 coronavirus outbreak drove more risky assets and the dollar.

The gold to the cash was down 1 % to the US $ 1,663.16 (0852 GMT) per ounce on Monday after climbing to the US $ 1,702.56, the highest since December 2012, on concerns about the virus. Gold futures in the United States fell 0.6 % to the US $ 1,664.80 an ounce.

In this regard, the President of the United States, Donald Trump, said he would take essential measures to protect the economy against the impact of the coronavirus.

For his part, the Minister of Economy of Japan said his government would not hesitate to take necessary measures to compensate for the effects on the national economy of the worldwide spread of the virus. 

Stephen Innes, a strategist at AxiCorp, said that the so-called domino effect is about to begin.

Moreover, he would expect the rest of the Asian governments to follow the blocking steps with similar packages.

Asian stocks and the dollar recovered, while government bond yields rose from record lows. Meanwhile, the yen fell from a maximum of more than three years touched on Monday.

Among other precious metals, palladium rose 0.4 % to the US $ 2,500.28 per ounce after falling to a minimum of almost a month on Monday. The silver was up 1 % to $ 17.13 per ounce. While platinum amounted to 1.5 % to the US $ 875.80 per ounce. 

More than 4,300 died by the Coronavirus worldwide

Coronavirus outbreak has reached more than 80 countries. More than 119,389 people have been infected by the coronavirus worldwide. Asa result, more than 4,300 died, according to Reuters estimates of official announcements.

The United States death toll rose to 31, and several members of Congress are in self-quarantine after potential exposure. 

In Italy, which has the most significant number of proved cases outside of China (10,149), travel constraints have been put on the entire country of sixty million people. Besides, there will be no public meetings and no sporting games. Prime Minister Giuseppe Conte shortly told his people to stay at home.

Fears of coronavirus transmission disrupt daily life and economic activity in new and unpredictable ways.