{"id":1185049,"date":"2020-05-18T11:10:31","date_gmt":"2020-05-18T16:10:31","guid":{"rendered":"https:\/\/www.mining.com\/?p=1024141"},"modified":"2020-05-18T11:10:31","modified_gmt":"2020-05-18T16:10:31","slug":"gold-price-jumps-to-new-7-year-high-over-fed-warnings","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1185049","title":{"rendered":"Gold price jumps to new 7-year high over Fed warnings"},"content":{"rendered":"<p>Gold climbed to a fresh seven-year high after the US Federal Reserve <a aria-label=\"said stocks and asset prices (opens in a new tab)\" href=\"https:\/\/www.bnnbloomberg.ca\/fed-warns-of-significant-hit-to-asset-prices-if-pandemic-grows-1.1437112\"  rel=\"noreferrer noopener\">said in a report last Friday<\/a> that stocks and asset prices could &#8220;suffer a significant hit&#8221; should the covid-19 pandemic deepen. Chairman Jerome Powell also warned that a full economic recovery could drag through until the end of 2021, depending on the delivery of a vaccine.<\/p>\n<div class='ad-slot' id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {    googletag.display('div-gpt-ad-1561499308230-0');    googletag.pubads().addEventListener('slotRenderEnded', function (event) {        if (event.isEmpty) {            var id = event.slot.getSlotElementId();            var x = document.getElementById(id);            if(x == null) return;            if (x.parentElement.classList.contains('ad-slot')) {                x.parentElement.style.display = 'none';            }\t\t\t\t        }    });});<\/script><\/div>\n<p>\u201cAsset prices remain vulnerable to significant price declines should the pandemic take an unexpected course, the economic fallout prove more adverse, or financial system strains reemerge,\u201d the Fed said in the report. <\/p>\n<p>Friday&#8217;s data also showed that US retail sales and industrial production both plunged last month, with the coronavirus crisis continuing to pummel the US labour market. The report cited commercial real estate as being particularly susceptible to falling valuations because \u201cprices were high relative to fundamentals before the pandemic.\u201d<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362080838-1024x576.jpg\" alt=\"\" class=\"wp-image-1024144\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362080838-1024x576.jpg 1024w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362080838-300x169.jpg 300w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362080838-768x432.jpg 768w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362080838.jpg 1200w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n<\/div>\n<p>On Monday, spot gold jumped as much as 1.2% to $1,764.73 an ounce, the highest since October 2012. Since then it has cooled off, trading at $1,734.31 an ounce as of 11:15 a.m. ET.<\/p>\n<p>Gold futures for June delivery also rose 1.0% earlier to $1,775.8 an ounce before falling down to $1,739.70 on the Comex.<\/p>\n<p>Bullion has surged 16% this year as investors turned to gold for protection in the wake of the economic turmoil created by the coronavirus outbreak and the unprecedented scale of government response to assuage the decline.<\/p>\n<p>Possibility of further interest rate cuts and the ensuing threat of inflation have also made a case for holding the metal, evident in the <a aria-label=\"record holdings (opens in a new tab)\" href=\"https:\/\/www.mining.com\/gold-price-nears-3-week-high\/\"  rel=\"noreferrer noopener\">record holdings<\/a> in gold-backed exchange-traded funds.<\/p>\n<p>\u201cThe market continues to speculate about negative interest rates in the US and extremely low interest rates and cheap money all over the world,\u201d Commerzbank analyst Eugen Weinberg <a aria-label=\"told CNBC (opens in a new tab)\" href=\"https:\/\/www.cnbc.com\/2020\/05\/18\/gold-markets-us-china-tensions-economic-data-in-focus.html\"  rel=\"noreferrer noopener\">told CNBC<\/a>. \u201cAlso, fears of economic crisis are unfolding given the very weak data in the United States and elsewhere.\u201d <\/p>\n<p>\u201cFinancial markets can best be described as factoring in the best-case scenario, with economic stimulus leading to a rapid recovery,\u201d Gavin Wendt, senior resource analyst at MineLife Pty, said in a <a aria-label=\"Bloomberg interview (opens in a new tab)\" href=\"https:\/\/mercury.bloomberg.com\/news\/QAIHK0T0G1KY\"  rel=\"noreferrer noopener\">Bloomberg interview<\/a>. <\/p>\n<p>\u201cThe reality is likely to be quite different and there is the prospect that no vaccine will be developed. The recovery is probably set to be more problematic than the optimists think, with gold set to benefit from the enormous boost to money supply that is going to ensue,\u201d Wendt added.<\/p>\n<h2>Palladium rally<\/h2>\n<p>Gold is not the only precious metal in the spotlight on Monday. Palladium topped $2,000 an ounce once again and jumped as much as 8.3%, the most since March 25, amid renewed optimism about China\u2019s economy reopening and planned stimulus for automakers. <\/p>\n<p><a aria-label=\"Last week (opens in a new tab)\" href=\"https:\/\/www.nornickel.com\/news-and-media\/press-releases-and-news\/metals-market-review-by-nornickel-with-financial-market-analysis-by-icbc-standard-bank\/?redirect_url=\/news-and-media\/press-releases-and-news\/\"  rel=\"noreferrer noopener\">Last week<\/a>, the world&#8217;s largest palladium producer Norilsk Nickel PJSC said demand for the battery metal may drop 16% this year, the most in almost two decades.<\/p>\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362084087-1024x576.jpg\" alt=\"\" class=\"wp-image-1024158\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362084087-1024x576.jpg 1024w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362084087-300x169.jpg 300w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362084087-768x432.jpg 768w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/362084087.jpg 1200w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n<\/div>\n<p>\u201cPalladium is seeing strength on supply concerns due to the virus-related reduction in mining activities,\u201d Gnanasekar Thiagarajan, director at Commtrendz Risk Management Services Pvt, told Bloomberg. \u201cDuring May-June output is expected to be lower.\u201d<\/p>\n<p>In other precious metals, silver climbed as much as 4% and platinum advanced 3.5%. Both metals are facing supply concerns as Mexico, the world&#8217;s biggest silver producer, has yet to resume mining activities, while South Africa is <a aria-label=\"having its own issues (opens in a new tab)\" href=\"https:\/\/www.mining.com\/web\/south-africas-impala-closes-platinum-mine-due-to-coronavirus-cases\/\"  rel=\"noreferrer noopener\">having its own issues<\/a> in steering platinum production back on track.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Palladium also climbed to its highest since March.<\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[2849,949,369],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1185049"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1185049"}],"version-history":[{"count":8,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1185049\/revisions"}],"predecessor-version":[{"id":1185071,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1185049\/revisions\/1185071"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1185049"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1185049"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1185049"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}