Gold pulls back from highest level since 2012

Silver leads losses among Comex metals, down 3%

Gold futures on Wednesday retreated, threatening to snap a multiday win streak, as the commodity paused after touching its highest settlement in more than seven years in the previous session.
A sharp pullback in bullion prices comes as the U.S. dollar was higher, providing some resistance to the asset’s climb toward an all-time high.
Dollar gains have come as a demand for the perceived safety of the word’s reserve currency has increased due to worries about the global economic impact of the coronavirus and a renewed downturn in crude-oil CL.1, -2.08% prices on the back of worries of decreased appetite for oil due to the virus.
The U.S. dollar DXY, +0.74% against a basket of a half-dozen rivals was up 0.7% in Wednesday dealings. A stronger dollar can make assets priced in the currency more expensive to buyers using other monetary units.
The dollar is back in favor “as stocks tumble on the various warnings, which is pulling gold off its newly established highs,” wrote Craig Erlam, senior market analyst at Oanda, in a Wednesday research note.
Gold for June delivery GCM20, -1.82% on Comex fell $28.10, or 1.6%, to $1,740.80 an ounce, after gaining 0.4% on Tuesday to settle at the highest for a most-active contract since October 2012, according to Dow Jones Market Data. Gold would halt a four-session win streak with a negative settlement on Wednesday.
“Institutional investors dominate the gold market and so that’s what the official prices reflect,” Marhsall Gittler, head of investment research at BDSwiss Group, told MarketWatch. When the stock market crash started, “institutional investors were selling anything that had a bid, and that included gold.”
That said, analysts appear to be upbeat about the long-term prospects for the yellow metal.
“If we are due a pull back in risk markets then that could slow gold’s progress, if the dollar remains in favour, but longer term, this environment is very favourable and I think all-time highs may not be too far away,” Erlam wrote.
Investors were digesting a slate of U.S. economic reports, including the New York Fed’s Empire State business conditions index , which plummeted to -78.2 in April, marking the lowest reading on record. And a reading on retail sales saw a record 8.7% slump in sales at U.S. retailers.
Gold mostly held its losses after that downbeat data.
Meanwhile, the International Energy Agency earlier in the day said we may see the worst year in modern history for oil markets.
Elsewhere in Comex, the most-active May contract for silver SIK20, -3.25% fell 52 cents, or 3.2%, to $15.61 an ounce, giving up a chunk of its 3.8% advance from Tuesday. May copper HGK20, -1.41% shed 1.3% to $2.2985 a pound.
July platinum PLN20, -1.68% lost 1.6% to $806.50 an ounce and June palladium PAM20, -1.60% traded at $2,141.20, down 2%.

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