Explosion in Coronavirus Cases Sends Gold to 10-Day High

The price of gold rallied on Thursday after an unexpected surge in reported coronavirus infections curbed appetite for risk. While stocks have recovered from an early-morning slump, gold continued to hold gains heading into the close. Futures on April gold deliveries rose $10.10, or 0.6%, to $1,581.70 a troy ounce on the Comex division of the New York Mercantile Exchange. The rally more than offset an early-week slump in bullion prices after stocks returned to record highs.

A total of 14,840 people were diagnosed with the novel disease after Hubei, one of the centers of the epidemic, broadened its methodology for determining infections. At last check, there were more than 60,300 confirmed cases of coronavirus in 30 countries and territories. The White House believes China may be under-reporting the number of infections “by at least 100,000,” according to Edward Lawrence, a correspondent with FOX Business. In a Thursday tweet, Lawrence said the administration also believes China is “severely” understating the death toll.

Gold usually provides a safe bet for investors in times of rising inflation. Even by the government’s own measures, inflation is running higher than interest rates. Gold is likely to continue rising so long as real interest rates are falling. Even in a nominal sense, interest rates have been in free-fall over the past year-and-a-half. Since September 2018, the U.S. 10-year Treasury yield has plunged by half. On Thursday, the yield was hovering around 1.61%, according to CNBC data.