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Gold prices trade to one-month high on COVID-19 concerns - analysts

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(Kitco News) - Gold is starting a new week on firmer footing amid worries about the rising number of COVID-19 cases, analysts said. Spot gold traded up to $1,757.65 an ounce although it backed off to $1,747.55 around 7:50 a.m. EDT, still up $5.30 for the day. “The price of gold jumped to its highest in more than a month this morning, after surging coronavirus cases heightened concerns over a delay in global economic recovery,” said a research note from commodities brokerage SP Angel. Analysts cited news reports showing that while social distancing in March and April slowed the spread of the virus, reopening in a number of U.S. states and European nations has coincided with a new wave of infections. This means the U.S. economic recovery is “hanging in the balance,” said Commerzbank. “There are thus likely to be increasing calls for the U.S. government to implement further stimulus measures, especially as [Federal Reserve Chair Jerome] Powell had already called for more fiscal stimulus during his virtual testimony before the U.S. Congress last week,” Commerzbank continued. “What is more, the U.S. Fed is likely to keep the pedal to the metal – i.e. to expand its balance sheet. Thus the issue of currency debasement/inflation will remain high in the minds of market participants.”

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