Gold futures contracts fell lower during today’s Asian trade session. The spot futures contract had hit a seven year peak, at a price point not seen since March 2013, during the previous trade session.
Traders are watching Beijing as China introduces stimulus measures to shore up their economy in order to stem the damage from the coronavirus. This set a risk-on mood in the financial markets as equities moved higher and safe haven assets lower.
As of 2:55 am GMT, the widely traded spot gold futures contract was down 0.1 percent to trade at 1,609.59 per ounce. Yesterday, the spot contract hit an intraday high at $1,612.62. This was its highest price point since March 25, 2013.
The U.S. gold futures contract was trading flat at $1,612.20 per ounce.
The silver spot contract was down 0.3 percent to trade at $18.34 per ounce. This is near its highest price level in a month. The platinum spot contract was down 0.7 percent at $998 per ounce.
Palladium, which remains in net shortage, was trading up 0.8 percent to $2,735.90 per ounce. This contract hit a record high at $2,841.54 during the previous session.
Risk on Sentiment Sends Gold Lower but Equities Higher
The number of coronavirus cases is falling lower in China. Traders are also expecting more monetary policy and fiscal stimulus out of Beijing.
Yesterday, China’s central Hubei province reported 349 new confirmed cases of coronavirus. This is down from 1,693 a day earlier and the lowest increase since January 25.
The Peoples’ Bank of China, as was expected, cut their overnight benchmark lending rate to support a slowing economy hit by this viral epidemic.
FOMC Meeting Minutes Provide Insight into Future Rate Decision
Yesterday, the U.S. Federal Reserve Board published their monetary policy meeting minutes from last month. The FOMC, the monetary policy arm of the Fed, is cautiously optimistic with the economy and see monetary policy settings in a good place to sustain growth and spur inflation towards their target of two percent.
The FOMC did mention the coronavirus but comments were limited as the virus had not become a full blown problem when this meeting was taking place.