Gold prices rose sharply and front-month gold futures contracts settled at near 9-year high on Tuesday, buoyed by the announcement of a euro-area recovery fund by the European Union and on optimism about fresh stimulus in the U.S.
The dollar’s sharp fall contributed as well to the yellow metal’s marked rise.
The dollar index fell to 95.05 this afternoon and was last seen at 95.12, down as much as 0.75% from previous close.
Gold futures for August ended up $26.50 or about 1.5% at $1,843.90, slightly off the day’s high of $1,844.90 an ounce. It was a fresh near nine-year high for the contract.
Silver futures for September moved up $1.365 or about 6.8% to $21.557 an ounce, the highest settlement since March 2014.
Meanwhile, copper futures for September settled at $2.9580 per pound, gaining $0.0425 or 1.5%.
EU leaders agreed on a EUR 1.8 trillion package of measures to tackle the exceptional nature of the economic and social situation posed by the coronavirus pandemic.
After four days of marathon talks in Brussels, EU leaders conceded the package worth EUR 750 billion. Accordingly, the bloc will issue debt jointly which would be provided to member nations hit hardest by the Covid-19.
Out of the EUR 750 billion recovery plan, EUR 390 billion will be in the form of grants and EUR 360 billion of low interest rate loans. Now the deal needs to be approved by the parliament of 27 member states.
According to the original plan, EUR 500 billion was allocated for grants and EUR 250 billion in loans.
The material has been provided by InstaForex Company – www.instaforex.com