PRECIOUS-Gold at 4-mth low as strong U.S. data, vaccine trials boost recovery hopes

  • Reuters
  • Stock Market News
PRECIOUS-Gold at 4-mth low as strong U.S. data, vaccine trials boost recovery hopes
Credit: © Reuters.

(Updates prices)

* U.S. manufacturing, services activity expanded rapidly in Nov

* AstraZeneca says COVID-19 vaccine can be 90% effective

* Tailwinds behind gold have not yet fully dissipated-analyst

* Interactive graphic tracking global spread of coronavirus: open

* https://tmsnrt.rs/3aIRuz7 in an external browser

By Shreyansi Singh

Nov 23 (Reuters) - Gold fell more than 2% to its lowest level in four month on Monday as better-than-expected U.S. business activity data and promising COVID-19 vaccine trials boosted hopes for a swifter economic recovery.

Spot gold XAU= dipped 1.7% to $1,838.71 per ounce by 01:50 p.m. EST (1850 GMT), after falling as much as 2.2% to its lowest since July 21 at $1,830.19. U.S. gold futures GCv1 settled down 1.9% at $1,837.80.

"Gold broke below the key $1,850 level after an unbelievably strong U.S. PMI release just dampened the need for stimulus. No one was expecting such strong readings in both services and manufacturing," said Edward Moya, senior market analyst at OANDA.

Data on Monday showed U.S. business activity in November expanded at its fastest rate in more than five years, boosting optimism about the health of the U.S. economy among investors. .N upbeat data came after Britain's AstraZeneca AZN.L said its vaccine could be around 90% effective without any serious side effects. are rotating back to stocks because of the fact that there is little less uncertainty now than there was," said Jeffrey Sica, founder of Circle Squared Alternative Investments.

"The data that came out today makes it more likely that we will see a recovery (sooner) than originally anticipated."

Further denting bullion's appeal, the dollar .DXY rose against rivals. USD/

Gold has risen more than 21% this year, benefiting from its attraction as a safe haven against inflation and currency debasement.

"While we do expect gold to go onto the defensive when the global economies start to show sustainable recoveries, the tailwinds behind the market have not yet been fully dissipated," StoneX analyst Rhona O'Connell said in a note.

Silver XAG= fell 2.4% to $23.56 an ounce, platinum XPT= dipped 2.2% to $925.24, while palladium XPD= rose 1.3% to $2,355.57.

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