Gold firms on dollar slide, U.S. stimulus hopes
· Gold prices edged higher on Thursday as a softer dollar and signs of progress in negotiations over fresh U.S. stimulus measures bolstered the metal’s appeal.
· Spot gold rose 0.3% to $1,891.10 per ounce by 0334 GMT, starting the new month on a positive note after it slumped to its biggest monthly drop since late 2016 in September.
· U.S. gold futures inched 0.1% higher to $1,897.30.
· “There’s a bit of relief that the dollar rally has for the most part ended and it seems many investors are more so focused on the headwinds ahead of the global economic recovery,” said Edward Moya, a senior market analyst at OANDA in New York.
· The dollar index slipped 0.2% against its rivals to hover near a one-week low, making gold less expensive for holders of other currencies.
· U.S. Treasury Secretary Steven Mnuchin on Wednesday said talks with House Speaker Nancy Pelosi “made a lot of progress” on the long-awaited Covid-19 relief legislation.
· Governments and central banks across the globe have rolled out unparalleled stimulus measures to revive their pandemic-hit economies, helping gold rise more than 20% so far in the year because of its role as a hedge against inflation and currency debasement.
· Market participants are now waiting for the U.S. initial jobless claims data due later in the day and the non-farm payrolls report on Friday for clues about the pace of recovery in the world’s largest economy.
· If U.S. jobs data comes at least in line with expectations and as long as the wage inflation number is strong, that maybe gold negative, said DailyFx currency strategist Ilya Spivak.
· Among other precious metals, silver rose 1.3% to $23.50 per ounce. Platinum hit a more than one-week high of $904.45 per ounce and was last up 1.7% at $903.18, while palladium gained 0.7% to $2,321.70.
Reference: CNBC
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