Gold edged lower today, reversing course from a 3% surge in the previous session following a surprise rate cut by the U.S. Federal Reserve as equities and the dollar regained some ground.
Spot gold slipped 0.2% to $1,636.13 per ounce as of 08:38 GMT, having risen as much as 0.7% earlier in the session and registered its biggest one-day percentage gain since 2016 on Tuesday, while U.S. gold futures slipped 0.4% to $1,637.20 per ounce.
“In the very short term, gold has perhaps reached its upside limit as this rate cut is priced in,” CMC Markets analyst Margaret Yang Yan said.
A broad uptick in risk-on sentiment and a rebound in the dollar index are weighing on gold, she added.
The U.S. stock futures rose over 1% and European shares inched up, recovering from weakness in global equities earlier as the emergency cut from the Fed seemed to stoke rather than soothe fears over the virus’ widening economic fallout.
Elsewhere, palladium fell 2.1% to $2,449.03 per ounce, while platinum was up 0.1% at $875.99.
Silver also gained 0.1% to $17.19 an ounce.