Gold prices shoot up in early trades
Fresh rush to pick up safe haven asset as fears spread about virus attack
Hong Kong (Bloomberg): Gold prices have jumped as the spread of the coronavirus globally spurred demand for haven assets.
Prices rose as much as 1.1 per cent as risk-off sentiment swept markets, with equities tumbling and Treasures gaining. Spot gold is trading at $1,581 an ounce levels, extending last week’s advance.
In the UAE, the price was at Dh179 a gram as of Sunday’s closing.
While the return of risk aversion is supportive of haven assets like bullion, investors are also assessing the extent to which the virus may keep consumers away from shops, damping the usual pick up in gold purchases during the holiday period.
In the latest effort to contain the virus, China extended the week-long Lunar New Year holiday and banned all outgoing overseas group tours to avoid having travelers contribute to its spread.
“Markets are focused on news around the deadly coronavirus,” Bank of New Zealand said in a report. “There will clearly be a significant economic impact, centered in China. A key question is the time it will take for the virus to be contained and one can only speculate at this stage.”