Gold prices were down in Asia on Wednesday morning, extending yesterday’s losses amid speculations that Russia might move from big buyer to possible seller of bullion.
Gold futures were down 0.13% to $1,594.45 by 09:40 PM ET (2:40 AM GMT), but the losses were limited as investors remained cautious amid turbulent economic times.
Reports that Russia, the world’s largest purchaser of bullion, decided to suspend gold purchases starting today were cited as a headwind for the yellow metal.
Gold prices have been under pressure in recent weeks even as the coronavirus outbreak continued to worsen, as investors dumped their holdings in the yellow metal to raise cash to cover trade margins and losses in stocks and elsewhere.
“Gold has acted more like a risk asset than safe-haven,” said Barani Krishnan, commodity analyst at Investing.com.
“A sense of caution still lingers in the air which is stimulating appetite for the dollar for investors,” FXTM analyst Lukman Otunuga.Otunuga told CNBC in an interview, noting that a stronger dollar could put pressure on gold prices.
“Global sentiment remains shaky despite central banks and governments standing together in the fight against COVID-19, with fears revolving around a global recession should send investors rushing towards gold, especially if cracks start showing in the largest economy in the world,” he added.