NVDA Q3 Earnings Alert: Why our AI stock picker is still holding Nvidia stockRead More

PRECIOUS-Gold bounces off 5-month low on weaker dollar, virus woes

Published 01/12/2020, 09:52 pm
Updated 01/12/2020, 11:42 pm
© Reuters.
XAU/USD
-
XAG/USD
-
GC
-
SI
-
PA
-
PL
-
DXY
-

(Updates prices)

* Gold supported by physical demand from India, China - analyst

* Silver rises as much as 4%

* Powell's testimony before Senate Banking Committee due 1500 GMT

* Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa

By Eileen Soreng

Dec 1 (Reuters) - Gold rose over 1% on Tuesday, rebounding from a five-month trough in the previous session, on a weaker dollar and as rising coronavirus cases overshadowed some of the optimism for a quicker vaccine-fueled economic recovery.

Spot gold XAU= climbed 1.5% to $1,804.33 per ounce by 1217 GMT. U.S. gold futures GCv1 gained 1.6% to $1,809.60.

The metal clocked its worst monthly fall in four years on Monday, slipping to $1,764.29, the lowest since July 2, as investors flocked to riskier assets such as equities.

"Gold seems to be deriving strength from a tired dollar and mixed comments from U.S. Federal Reserve Chair Jerome Powell and Treasury Secretary Steve Mnuchin," said Lukman Otunuga, senior research analyst at FXTM.

"Concerns over spiking coronavirus cases are also contributing to the metal's upside despite the growing optimism around vaccine developments."

In remarks released on Monday, Powell said the U.S. is entering "challenging" few months, while a potential vaccine faces challenges of production and mass distribution before its economic impact becomes clear. a survey showed euro zone factory growth cooled in November as renewed coronavirus lockdown measures hurt demand. gold cheaper for investors holding other currencies, the dollar .DXY fell, pressured by expectations of more U.S. economic stimulus, with attention turning to Powell's testimony before the Senate Banking Committee later in the day. USD/

Underlying drivers for gold have not changed, including the dollar, and movements in real yields, which are still at their lowest in about a month, said Saxo Bank analyst Ole Hansen.

Non-yielding gold has risen over 18% so far this year, given its appeal as a hedge against inflation spurred by the unprecedented stimulus measures unleashed to ease the pandemic's economic blow.

Bullion also remains supported by physical demand from India and China at current levels, said independent analyst Ross Norman. GOL/AS

Silver XAG= gained 3.5% to $23.40 per ounce, while platinum XPT= rose 1.7% to $980.90 and palladium XPD= rose 0.8% to $2,392.34.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.