LONDON: Gold slipped 1% on Wednesday, retreating further from the previous session's two-week peak as optimism over Covid-19 vaccine developments prompted a rush for riskier assets. Spot gold was down 1.1% at $1,851.16 per ounce by 9:55 a.m. EST (1455 GMT). On Tuesday it hit its highest since Nov. 23 at $1,875.07.
US gold futures also slipped 1.1% to $1,855.10.
"There is the anticipation that some of the chaos that has resulted from the pandemic is going to subside (now that) they are beginning to disperse the vaccine in some parts of the world," said Jeffrey Sica, founder of Circle Squared Alternative Investments.
There has been a shift to riskier assets, Sica added.
After Britain on Tuesday became the first Western nation to start a mass vaccination drive, Pfizer and Johnson & Johnson made further progress with trials and regulatory approvals respectively.
Global equities scaled record highs, as investors cheered positive coronavirus vaccine news and hopes that it would speed up an economic recovery. With the pandemic roaring back to levels surpassing those seen early in the crisis, lawmakers in the United States made attempts to hammer out an agreement on a new fiscal support package.
Gold, considered a hedge against potential inflation, rose to a two-week high underpinned by hopes of more fiscal stimulus on Tuesday, however the news largely supported risk sentiment on Wednesday. Investors also awaited the US Federal Reserve's two-day policy meeting next week for cues on the direction of monetary policy.
"A dovish FOMC, particularly in the scenario where they look to cap rates in the longer end of the US yield curve, should relight the gold rally," said Jeffrey Halley, a senior market analyst at OANDA.
Silver slipped 1.7% to $24.15, while platinum fell 0.2% to $1,020.87 and palladium was down 0.7% to $2,293.26.
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