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Gold rises 1% as recession fears send investors scurrying for safe haven

The benchmark US 10-year Treasury yields fell to a record low, while the yen rose to its highest since October against the US dollar



prices rose more than 1% on Monday, following a steep fall across the complex in the previous session, as worries that the epidemic could push the global economy into recession sent investors scurrying for safe havens.


Spot gained 1.2% to $1,602.90 per ounce by 0104 GMT, having slumped more than 4% in intraday trade on Friday.

U.S. futures rose 1.9% to $1,597.10.

The rout in world stocks deepened, with investors rattled by weekend data from China that showed its fastest ever contraction in factory activity, raising fears of a global recession from the

The benchmark U.S. 10-year Treasury yields fell to a record low, while the yen rose to its highest since October against the U.S. dollar.

Factory activity in China contracted at the fastest pace ever in February, even worse than during the global financial crisis, highlighting the damage from the outbreak.

China's manufacturers are struggling to find enough workers to fill factory floors as the regular post-Lunar New Year labour migration trickles rather than flows, slowing the restart of the economy amid the virus crisis.

The worldwide spread of the virus and its implications on the economy had triggered the biggest weekly stock market rout since the 2008 financial crisis last week, wiping $6 trillion off global equities.

Goldman Sachs economists on Sunday predicted the Federal Reserve will cut rates aggressively, saying the head of the U.S. central bank sent a clear signal with his unscheduled statement on Friday.

On Friday, Fed Chair Jerome Powell issued a statement in which he said that while the U.S. economy remained strong, the virus "posed an evolving risk" and the Fed stood ready to take action if needed.

Palladium rose 0.7% to $2,610.62 per ounce, having slumped as much as 13% in the previous session.

Platinum gained 1.9% to $880.10, having touched a six-month low on Friday.

Silver rose 1.3% to $16.88, backing away from an almost seven-month low touched in the last session.


First Published: Mon, March 02 2020. 09:25 IST