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PRECIOUS-Gold edges up as dollar slips, pandemic fears grow

Published 30/10/2020, 03:47 pm
© Reuters.
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* Spot gold on track for third straight month of decline

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

By Eileen Soreng

Oct 30 (Reuters) - Gold gained on Friday as the dollar retreated, pushing safe-haven inflows to bullion again after a surge in coronavirus cases in the United States and Europe threatened to derail an economic recovery.

Spot gold XAU= edged up 0.1% at $1,869.16 per ounce by 0711 GMT. It saw sharp declines in the last two sessions as it lost out to the dollar as the preferred hedge against risks from a worsening pandemic and Tuesday's U.S. presidential elections.

U.S. gold futures GCcv1 also rose 0.1% to $1,869.

The dollar index .DXY paused its rally and was flat against a basket of currencies, making bullion cheaper for holders of other currencies. USD/

"The dollar rebound appears to have run its course," said Edward Moya, senior market analyst at OANDA.

"The virus spread is going to provide additional pressure on the Congress to deliver more support... That's just going to bolster the stimulus trade going forward."

The U.S. broke its single-day record for new infections on Thursday, while Germany and France ordered fresh lockdowns. was on track for a third straight month of declines, with sentiment dented by a lack of progress on a new U.S. fiscal package, since bullion is considered a hedge against inflation and currency debasement.

"Leading into the U.S. elections I see it (gold) staying weak," said Michael Langford, executive director at corporate advisory and consultancy firm AirGuide.

But "regardless of whoever wins the election, there is going to be some form of stimulus program and that's positive for gold."

U.S. polls show Democratic contender Joe Biden with a significant edge nationally, but with a tighter lead in battleground states that can decide the election. the recent pullback, gold is up nearly 24% this year, thanks to unprecedented global stimulus measures.

Silver XAG= fell 0.3% to $23.21 per ounce. Platinum XPT= eased 0.1% to 847.02 and palladium XPD= gained 0.6% at $2,205.66.

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