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PRECIOUS-Gold climbs back above $2,000/oz level as dollar slides

Published 18/08/2020, 09:00 pm
© Reuters.
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* Gold hits one-week high at $2,009.89/oz

* Silver jumps as much as 3.5%

* Interactive graphic tracking global spread of coronavirus: open https://tmsnrt.rs/3aIRuz7 in an external browser

(Updates prices)

By Eileen Soreng

Aug 18 (Reuters) - Gold rose more than 1% on Tuesday to climb back above the $2,000 level breached earlier this month, as the dollar hit a more than two-year low and investors awaited details of the U.S. Federal Reserve's strategy to combat a pandemic-induced economic slump.

Spot gold XAU= was up 1% at $2,005.04 per ounce by 1158 GMT, having earlier hit a one-week peak of $2,009.89. Gold first broke the record $2,000-level early in August, reaching an all-time high of $2,072.50.

U.S. gold futures GCcv1 were up 0.8% at $2,014.40.

"It's really is about the return or the perception of a return," Michael Hewson, chief market analyst at CMC Markets UK, said. "The dollar has lost its attraction when it comes to return now relative to two years ago."

Making gold cheaper for those holding other currencies, the dollar index .DXY hit its lowest since May 2018, pressured by low yields and bleak U.S. economic data. USD/ US/

On Monday, gold jumped as much as 2.4%, drawing impetus from Warren Buffett's Berkshire Hathaway (NYSE:BRKa) buying a stake in major gold miner Barrick Gold. reinforced gold's 32% surge this year, helped by a rush to perceived safety in the metal considered a hedge against inflation and currency debasement. USD/ with its reputation for relative safety, is also drawing investors as the United States ratchets up pressure on China's Huawei HWT.UL , CMC's Hewson said. MKTS/GLOB

For further direction, investors are awaiting minutes from the Fed's last meeting, which are due on Wednesday. are getting the last kick at the can ahead of the FOMC minutes, where the view is for the Fed to have talked about YCC (yields curve control) or inflation-targeting, which is bad for the dollar and good for gold," said Stephen Innes, chief market strategist at financial services firm AxiCorp.

Silver XAG= climbed 2.4% to $28.05 per ounce.

Platinum XPT= rose 1.1% to $960.06 per ounce, while palladium XPD= eased 0.2% to $2,195.18.

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