Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 2% to close under $1,487 as coronavirus panic caused a historic rout in equity markets, forcing investors to scramble for cash wherever they could find it.

With the spread of COVID-19 escalating throughout the nation, all three major US stock indexes fell more 12%, marking one of the worst stock market declines in history. As stop-loss thresholds were broken and automatic sell-orders triggered, the losses cascaded.

Individual investors and large funds alike were forced to find cash to cover margin calls on leveraged equity positions. Highly liquid assets like gold and silver were liquidated despite their status as safe havens. Gold fell as low $1,451 in early trade before rebounding sharply, then extending its rise after hours to $1,515 in electronic trade.

The panicked sell off in stocks came after the Federal Reserve, in an emergency Sunday meeting, slashed interest rates by a full point to near zero and announced $700 billion in quantitative easing designed to prevent the financial markets from seizing up.

These extremely aggressive moves by the Fed, which have not been seen since the financial crisis of 2008, did little to calm the markets. Chair Jerome Powell warned that GDP may fall into the negative in Q2 as the US and global economies shut down under the strain of the deadly contagion. Goldman Sachs projects GDP growth of -5%.

The dollar fell 0.7% against major rivals on the Fed's cuts, while yields on benchmark 10-year Treasury bonds fell under 0.25%.

The first US data reflecting COVID-19 shows its devastating impact. New York's Empire State manufacturing index plunged a record 34 points to negative 21.5 in March. Most economists think the toll of the pandemic is just getting started.

The other precious metals were mostly lower, with silver and platinum plummeting 12% while palladium edged up 0.3%.

At the Comex close: April gold fell $30.20 to $1,486.50; May silver dumped $1.68, or nearly 12%, to $12.82, its lowest close since July 2009; April platinum dropped $86.20 to $657.70; and June palladium added $5, to $1,514.10 an ounce.