Gold climbs following fresh Covid fears
Liam Sheasby, News Editor
21 Apr 2021, 12:53 p.m.
The gold price today edged closer to $1,800 following fresh fears over the dramatic rise in Covid-19 cases in India, as well as difficulty in containing some variants of the disease in Europe.
Gold peaked at $1,788.54 per ounce this morning, but has since fallen back $10. The current $1,778.88 per ounce is an increase of 7.97% today however – a strong indication of risk off sentiment.
While the world slowly recovers from the worst damage of Covid-19 through lockdowns and vaccinations, the World Health Organisation and India's government are currently battling against a surge in Covid cases – setting a new record of 295,041 in a single day yesterday.
Economic news outlets are reporting a trend of capital moving into safe-havens, with gold and Treasuries benefiting. The 10-year bond rate dropped to a five-week low of 1.56%, after having been heavily sold following reassurance from central banks that inflation would be managed and from governments such as the US and UK that vaccination programs would continue at pace.
Gold has been rising in price for the past month though, moving upwards from $1,745 per ounce to today's $1,778. Volatility is still prevalent though, as the battle of truth vs spin rages on over inflation and Covid. The duty of the central banks is to minimise volatility and uncertainty, so it should come as no surprise that the impacts of these variables would be played down, but investors are wise enough to know when financial language is support and when it's just trying to perform patch repairs.
Economists have already pointed out the rising prices for food and fuel, but now housing is the next big sector to monitor, with house prices in the UK setting a new record last month – as seen in our article.