Gold climbs after dampened hopes from COVID-19 vaccine report

Wednesday morning saw gold climb after hopes arose in news of a possible vaccine for the coronavirus being expedited on Tuesday.

However, vacccine experts were quick to rain on Moderna’s parade after the drug manufacturer announced of a potential cure for the virus with 45 trial participants getting an immune response. The experts’ report released on Tuesday stipulated that there was simply insufficient evidence that could solidify the breakthrough claims.

Gold Futures climbed up by 0.44%, settling at $1,753.20 by 12:57AM ET. Post disillusionment from the COVID-19 vaccine, investors turned to the precious metal, following risk sentiment that had gone sour.

Meanwhile, Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell had faced the Senate Banking Committee on Tuesday, as they were questioned on the amount of funding released through already-operating programs they have authored.

Powell stood by his statements made last April, saying, “this is the time to use the great fiscal power of the U.S. It’s all ahead of us. The amount that has gone out so far, in the context of the U.S. economy, is fairly modest.”

The Feredal Reserve Chairman had repeated that the Federal Reserve was “committed to using our full range of tools to support the economy in this challenging time even as we recognize that these actions are only a part of a broader public-sector response.”

Looking into the skinny of the matter, ANZ analyst, Daniel Hynes had this to say in an iterview with CNBC:

“What the Fed does in the next few months will be pretty important, and certainly Powell did indicate that the rates would remain near zero for foreseeable future,”

Inevstors are anticipating the Ferederal Open Market Committee’s April 28-29 policy meeting minutes set to be released later in the day.

The Fed had kept gold afloat, keeping its interest rates near 0. This had been established as lower interest reduce the opportunity cost of holding gold.

Powell however neglected to declare if the tools mentioned in his testimony included negative rates.