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Gold slips as economic recovery hopes lift equities

Thursday,   21-May-2020   09:13 AM (IST)

Gold eased on Thursday as equities gained on hopes for a swift recovery from the coronavirus-induced economic slump, although losses were capped by optimism over further stimulus measures. Spot gold slipped 0.2% to $1,745.32 per ounce by 0044 GMT. U.S. gold futures declined 0.2% to $1,748.60. Asian shares were poised to open higher after global equities and crude prices rallied overnight on hopes of a rapid economic recovery and government support. The minutes of the latest Federal Reserve policy meeting showed that members acknowledged the possibility of further support measures if the economic downturn persists. Widespread stimulus measures tend to benefit gold as it is used as a hedge against inflation and currency debasement. Global coronavirus cases surpassed 5 million on Wednesday, with Latin America overtaking the United States and Europe in the past week to report the largest portion of new daily cases globally. Underscoring the economic impact of the pandemic, Britain's inflation rate sank in April to its lowest since August 2016, bolstering the prospect of more Bank of England stimulus next month. Euro zone annual inflation in April was 0.3%, the lowest level in nearly four years, according to final data released by Eurostat, which revised down its earlier estimate as energy prices fell more than initially expected. Palladium fell 0.9% to $2,082.98 per ounce, silver eased 0.4% to $17.44 and platinum dipped 0.1% to $849.74.