Coronavirus fears drive gold prices to seven-year high

Coronavirus fears drive gold prices to seven-year high

gold prices

Gold prices rose 1% to their highest in seven years on Friday and were set for their strongest week in more than six months as demand for the safe-haven asset increased after a spike in coronavirus cases.

South Korea reported 52 new cases of the virus, taking the national total to 156, while Japan reported the first fatalities from a cruise ship that accounts for the biggest cluster of infections outside China.

Coronavirus exploration is damage global growth and share markets. It directly affects the gold prices because this is the safe bet for all the investors.

Spot gold rose 0.8% to $1,632.65 per ounce by 0845 GMT, after hitting its highest since Feb. 14, 2013, at $1,635.98 earlier in the session. For the week, prices have risen 3% so far and were set to post their biggest weekly percentage gain since August 9.

The main focus for gold seems to be the virus uncertainty … and its spread across the world,” said John Sharma, an economist at National Australia Bank.

Asian shares fell as virus concerns caused funds to seek shelter in U.S. assets, lifting the dollar to three-year highs.

China also reported an uptick in new coronavirus cases on Friday, boosted by more than 200 people testing positive in two prisons outside of Hubei province.

Further spread of the disease could derail a “highly fragile” projected recovery in the global economy in 2020, the International Monetary Fund said on Wednesday.

So, if the coronavirus cases increase all over the world than we will see a sharp drop in global markets, like dow, dow future, Sensex, nifty, and hang sang. Drop-in the market is directly linked with Gold prices. So, after coronavirus expansion gold prices shine again because gold is the safe bet for all investors in this kind of situation.

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