Gold Supported Amid Easy Global Monetary Policy Hopes
Published on Jul 28, 2021 11:25
Gold continued to see choppy action with weakness in the US dollar capping downside. The metal also eyed the overall impact the Covid-19 will have on the global economy in long term. The IMF noted that the pandemic has reduced per capita incomes in advanced economies by 2.8% a year, relative to pre-pandemic trends over 2020-2022, compared with an annual per capita loss of 6.3% a year for emerging market and developing economies (excluding China). The metal edged up in Asia as market focussed on continued easy monetary policies from the global central banks. The IMF noted that central banks should avoid prematurely tightening policies when faced with transitory inflation pressures but should be prepared to move quickly if inflation expectations show signs of de-anchoring. Emerging markets should also prepare for possibly tighter external financial conditions by lengthening debt maturities where possible and limiting the buildup of unhedged foreign currency debt. Gold currently trades up 0.36% at $1806 per ounce.
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