Gold and the metal markets felt the heat as the formal start of US president-elect Joe Biden’s transition to the White House lifted riskier assets. The precious yellow metal suffered near a four-month low on November 25, 2020, as appetite for riskier assets remained underpinned by the formal start of the US president-elect Biden’s transition.
Furthermore, hopes that a Covid-19 vaccine would be ready soon also lifted the risky markets. Spot gold lost 0.2% to trade at $1,803.51/oz by 3.27am GMT. On November 24, the precious metal had hit its lowest level since July 17, trading at $1800.01. On their part, the US gold futures plunged 0.1% to trade at $1,803.20.
National Australia Bank’s head of commodity research, Lachlan Shaw, stated:
“We are moving into a new phase in gold as vaccine developments are changing the regime of pandemic-caused disruptions and headwinds to growth that gold markets were pricing in. If US real long yields range trade around current levels, it’s difficult to see gold breaking out and then sustaining a strong rally towards $1,900 and $2,000.”
President Trump gave the green light for Biden to begin receiving daily intelligence briefings; that is a sign that he has accepted the election result. Pennsylvania certified Biden’s victory in the battleground state, which might have pushed Trump to concede indirectly.
The Biden Presidency Transition
The official start of Biden’s transition to the White House coupled with positive developments around a possible COVID-19 vaccine enabled the world shares to scale a record peak. An overnight rise saw the Dow break the 30,000 ceilings for the first time.
A plunge below$1,800 may see more selling of gold, and the move away from the precious metal and towards the riskier assets could continue. Analysts like ED&F Man Capital Markets analyst Edward Meir expect that gold will find some support near $1,750-$1,770.
The release of the US Federal Reserve’s last meeting due at 7 pm GMT is what investors seem to be waiting for before the next price action develops in the market. On the physical aspect, data on Tuesday revealed that China’s net gold imports through Hong Kong recorded its sharpest monthly contraction since June in October.
Silver lost 0.2% to trade at $23.20/oz while platinum plunged 0.3% to $958.32. On its part, palladium was down 0.7% to trade at $2,332.01.