Gold prices headed slightly higher Tuesday, amid renewed optimism for a vaccine for the coronavirus which had undermined the need for a safe haven and caused gold to retreat Monday from the highest intraday levels since 2012.
Prices of the precious metal have been mostly elevated recently amid worries about the economic impact of the COVID-19 pandemic that has likely pushed the world into recession, underpinning the traditional haven appeal for the yellow metal that tends to rise during economic uncertainty.
Although reports indicate that pharmaceutical company Moderna Inc. MRNA, +19.95% has made some early progress toward a vaccine for the virus, some gold bulls say that the outsize fiscal and monetary stimulus measures enacted by governments across the globe will support gold buying over the long term.
“For long-term gold positions, a vaccine may not be an absolute game-changer as central bank balance sheets will not miraculously evaporate, and political/trade tensions between China and the US are unlikely to de-escalate,” wrote Stephen Innes, global chief market strategist at AxiCorp, in a daily research note.
Gold for June delivery on Comex GC00, +0.15% GCM20, +0.15% rose $2.50, or 0.1%, at $1,736.90 an ounce, following a 1.3% decline, which halted a five session streak of gains.
Meanwhile, July silver SIN20, +0.15% edged up a penny, or 0.1%, at $17.49 an ounce, after surging 2.4% on Monday.
