COVID-19 continues to ravage the global economy

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At 5:07 p.m. EST, the most active futures contract for the month of April is currently trading at $ 6.10 (+ 0.37%) and is set at $ 1,639.50. Although gold opened slightly above yesterday’s closing, today’s closing was lower than today’s opening price. It should also be noted that gold continues to have an exaggerated price range, as today’s prices have created a lower and a lower, compared to yesterday’s price action. Gold traded at a minimum of $ 1611 and a maximum of $ 1672.50 today.

However, the real picture is not the movement of gold, but rather an incredible weakness in the US dollar which is a direct result of this week’s jobless claims weekly report which indicated a huge increase of 3.2 million claims. Currently the dollar is down 1.48% which equals 1.492 points which brings the index below 100 and is currently set at 99.505.

According to Reuters, “the dollar fell sharply on Thursday after an unprecedented rise in unemployment claims led investors to anticipate that the US government and the Federal Reserve would take further steps to stimulate the economy. The number of Americans filing for unemployment benefits hit a record high of more than 3 million last week, as stringent measures to contain the coronavirus pandemic brutally stopped the country, sparking a wave of layoffs that likely ended the longest employment boom in the United States. history. “

After the release of unemployment statements today, Federal Reserve Chairman Jerome Powell said the United States “may well be in a recession,” but progress in controlling the spread of the coronavirus will dictate when the economy can reopen completely. This statement by the Fed chairman was rare because his statement came before he had data to support this hypothesis.
However, one fact is absolutely clear, the effects of COVID-19 (coronavirus) continue to have a negative impact on the global economy, as the virus continues to affect more people worldwide, increasing the number infected individuals and the number of deaths linked to this virus. This is the result of a sharp contraction in global GDP. Most alarming is the fact that most medical experts predict that this pandemic will worsen before it begins to decrease.
This fact prompted central banks around the world, including the Federal Reserve, to take emergency action. This is also why the Senate adopted a $ 2.2 trillion financial assistance program for businesses and individuals residing in the United States. The financial aid package has yet to be voted on and approved by the House of Representatives, then signed by the President of the United States before being promulgated.
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Warning: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has done everything possible to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept guilt for loss and / or damage resulting from the use of this publication.

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