Gold Down, Even Amid COVID-19 Uncertainty

Gold bars

Gold was down on Friday in precious metals. The number of coronavirus cases surged in Europe and the U.S. Moreover, the ongoing stalemate in the U.S. Congress over a COVID-19 package continues.

At $1,908.30 by 12:36 AM ET (4:36 AM) GMT, gold futures fell 0.03% at $1,908.30. It gave up its earlier gains.

However, a weakening dollar which was down on Friday capped losses.

To curb the spread of COVID-19, some European countries, such as the U.K. and France, are implementing new restrictions. As the temperature drops, the U.S. Midwest also saw rising numbers of coronavirus cases.

According to Johns Hopkins University data, there are over 7.9 million cases in the U.S. As of Oct. 16, over 38.8 million cases were recorded globally.

On Thursday, U.S. President Donald Trump offered to raise the price tag on the $1.8 trillion package that he earlier proposed. However, Senate Majority Leader Mitch McConnell rejected Trump’s offer for fear that Republicans would not agree to the price increase. 

Secretary of the Treasury Steven Mnuchin informed House of Representatives Speaker Nancy Pelosi that Trump will try to get reluctant Senate Republicans behind any deal reached.

Investors, however, continue to cast doubt on any deal materializing before the Nov. 3 presidential elections. It sees the yellow metal trade in a narrow range for the month of October.

Oil Slips on COVID-19 Resurgence

Oil prices slid on Friday’s energy commodities. Prices are dragged down by worries that a spike in COVID-19 cases in Europe and the United States is curtailing demand.  The industry is concerned that demand is being reduced in two of the world’s biggest fuel consuming regions.

By 0437 GMT, Brent crude futures for December fell 44 cents, or 1.0%, to $42.72 a barrel. The U.S. West Texas Intermediate crude futures for November delivery slid 40 cents. That equates to 1.0%, to $40.56 a barrel.

These benchmarks fell slightly the previous day and are likely to remain little changed for the week.

Worries over weakening fuel demand in Europe due to a resurgence in COVID-19 cases are weighing on investor sentiment. Additionally, a higher U.S. dollar against the euro is also doing the same. This was according to Kazuhiko Saito, chief analyst at Fujitomi Co.

In Europe, some countries were reviving curfews and lockdowns to fight the surge in virus cases. Britain has imposed tougher COVID-19 restrictions in London on Friday.

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