By Gina Lee
Investing.com – Gold prices were down on Friday in Asia as global stocks rose on the back of U.S. President Donald Trump's plans to reopen the world’s biggest economy after a month-long lockdown to prevent the spread of COVID-19.
President Trump announced the plans overnight, and Asian stocks were also up as China prepared to release its GDP data later in the day.
Gold futures were down by 0.38% at $1,725.20 by 9:47 PM ET (2:47 AM GMT), retreating from their gains in the previous session. Gold gained 1.3% as the U.S. also announced that 5.2 million people claimed unemployment over the past week, against analyst forecasts of 5.1 million claims prepared by Investing.com.
The economic impact of the COVID-19 pandemic is far from over, with over 20 million Americans losing their jobs since the end of March and worries that Trump’s plans could be too premature.
But investors remained optimistic for the yellow metal.
“With the talk of how governments are going to reopen economies, both equities and gold seem to be focused on moving past the peak of the pandemic. So from the perspective that there are some brighter skies ahead we’re seeing some pullback,” David Meger, director of metals trading at High Ridge Futures, told CNBC.
James Steel, chief precious metals analyst at HSBC, agreed with Merger in a note that said, “The health, financial and economic uncertainties generated by the COVID-19 pandemic and its aftermath are likely to continue to support gold’s rally well into 2021. We believe low interest rates, monetary accommodation and fiscal spending across the world for the foreseeable future will cement and extend gold’s rally, as investors target bullion for its hard asset characteristics and liquidity.”