Gold prices fell on Wednesday in Asian markets as its virus-led volatility drove investor risk sentiment towards other assets.
The International Monetary Fund (IMF) stated that the pandemic may lead the global economy to decline by 3% this year, marking it as the biggest drop since the Great Depression.
Gold Futures previously gained nearly 2% to its highest since 2012 after investors retreated to the precious metal in the wake of the announcement. However, these gains were later erased as it fell by 0.93% to $1,752.50 per ounce at 9:41 PM ET (2:41 AM GMT).
Analysts were mixed at the yellow metal’s current movement.
Head of Commodity Strategy at TD Securities, Bert Melek told Bloomberg that the steady decline was due to investors “locking in what they’ve gained on gold”.
However, Senior Market Strategist at RJO Futures, Bob Haberkorn expressed optimism as he told CNBC that despite the current outlook, recent rate cuts and stimulus packages could create a “perfect environment” for gold prices.