Gold breaks to near 7-year highs amid coronavirus fears, next target is $1,617
Gold prices have extended their gains and have topped $1,611.42, the previous 2020 peak. XAU/USD is now trading at the highest levels since March 2013. Back then, it hit a high of $1,617, which is the next upside target.
The coronavirus outbreak has raised concerns that the global economy may face a significant slowdown. Central banks may react to the downturn by further reducing interest rates, making the safe-haven investment in gold more attractive.
Gold reaching for the stars, structural bid in gold driven by a real rate suppression from central banks
The price of gold has extended gains and returned to test the start of the year and Iran/US highs. At the time of writing, gold trades at $1,607.66 having climbed between a low of $1,599.65 and $1,611.24. Risk appetite returned to financial markets mid-week as the established trend of buying dips continued.
The US dollar picked up a bid again on economic data as well as safe-haven flows, with the DXY rising to around a 45-month high. More on that here: US Dollar Index Price Analysis: DXY unstoppable ahead of FOMC, trading near 45-month highs
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