Gold prices drifted lower on Thursday, snapping a nine-session winning streak as traders looked to take some profits despite persisting worries about the coronavirus pandemic and its impact on global economy.
Gold was also weighed down by a report published by the World Gold Council that said global gold demand declined in the second quarter and first half of this year overall.
Total global gold demand fell 11% year-on-year in the second quarter, at 1,015.7 metric tons, pulling demand for the first half of the year down by 6% to 2,076 metric tons, the report said, and cited the COVID-19 pandemic as the main reason on the gold market in the second quarter.
However, demand for gold as an investment climbed to a record as exchange-traded-fund holdings reached an all-time high by the end of June, the report said.
The pandemic “severely curtailed consumer demand, while providing support for investment,” the report said.
The dollar index slid more than 0.4% to 93.04.
Gold futures for August ended down $11.10 or about 0.6% at $1,942.30 an ounce.
December gold futures, the most active gold futures contract, fell $9.90 or 0.5% to settle at $1,966.80 an ounce.
Silver futures for September lost $0.959 or 3.9% as it settled at $23.362 an ounce, while Copper futures for September ended down $0.0050 or 0.2% at $2.9140 per pound.
Rising coronavirus cases around the world as well as weak corporate earnings updates and economic data from Europe capped bullion’s downside.
Hong Kong, China, Japan, South Korea and India are seeing uptick in virus cases, bringing warnings over complacency. Australian Prime Minster Scott Morrison has labelled new coronavirus case numbers in Victoria as very concerning and warned the country has “no golden immunity” to the virus.
In U.S. economic news, data from the Commerce Department showed real gross domestic product plummeted at an annual rate of 32.9% in the second quarter following a 5% slump in the first quarter. Economists had expected a 34.1% nosedive in GDP.
Consumer spending led the decrease, cratering by 34.6% in the second quarter, as the coronavirus-induced lockdowns in late March and April forced many consumers to stay at home.
A report from the Labor Department said initial jobless claims edged up to 1.434 million in the week ended July 25th, an increase of 12,000 from the previous week’s revised level of 1,422,000. Economists had expected jobless claims to rise to 1.450 million from the 1.416 million originally reported for the previous week.
The material has been provided by InstaForex Company – www.instaforex.com