The recent outbreak of Coronavirus in China caused more than 400 deaths all over the world. The World Health Organization has announced Coronavirus infection as a health emergency last week. The ongoing Coronavirus episode has to lead to a drastic fall in the Chinese equities yesterday. The Asian stock market is not showing any signs of recovery.
The Chinese New Year opened on a note of disappointment as the metal prices dropped dramatically. Moreover, the People’s Bank of China had to slash the interest rates in an attempt to stabilize the falling Chinese stock market.
As of today, Gold is currently trading at $1,577. On the other hand, the US Dollar has been showing signs of a slight recovery. The US Dollar registered a massive drop in its prices on Friday. However, it showed some improvement recently. Moreover, the US and the European equities displayed some gains last night.
Gold Price Negatively Impacted By Various Factors
To cope up with the economic devastation as a result of the Coronavirus outbreak, the People’s Bank of China slashed the interest rate. Moreover, they also promised to do more in order to improve the market.
This encouraged traders and investors greatly. The risk sentiment improved a lot with the declaration of rate cuts by the Chinse banks. As a result, gold slowly began to lose its safe-haven status.
Moreover, the US equities market started to perform well since the last day and the US Treasury bond yielded impressive prices. All this helped the US Dollar to pick up its price in the international market.