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Gold gains as dollar rally stalls, virus cases mount

Published 31/10/2020, 01:36 am
©  Reuters
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* Gold still on track for third straight monthly decline

* Wall St drops as COVID cases jump

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

By Brijesh Patel

Oct 30 (Reuters) - Gold prices rose on Friday as the dollar rally paused, with worries over rising COVID-19 cases and uncertainty surrounding next week's U.S. presidential election offering support to the safe-haven metal.

Spot gold XAU= was up 0.6% at $1,879.01 by 01:30 p.m. EDT (1730 GMT) following two straight sessions of sharp declines. Bullion is down 0.3% this month.

U.S. gold futures GCv1 settled up 0.6% to $1,879.90.

"Gold rebounded as the dollar partially reversed its surprising two-day rally," said Tai Wong, head of base and precious metals derivatives trading at BMO.

"Investors are finding the bottom of the recent range a good level at which to add to gold holdings ahead of the hotly contested election next week, which seems likely to return a one-party government that means much bigger and faster stimulus."

The dollar index .DXY was steady against its rivals after climbing to its highest in a month in the previous session. USD/

Ahead of the Nov. 3 U.S. election day, Democrat challenger Joe Biden leads President Donald Trump nationally in the polls, but most competitive states have shown a closer race. a lot of structural pieces in place for gold to continue to rise after the election, regardless of the outcome," said Kevin Rich, Global Gold Market Advisor for The Perth Mint.

"Based on the amount of fiscal stimulus that is gone in from here in the United States and globally ... (and) the enormous amount of government debt taken on ... that's going to put a lot of currencies under pressure, including the U.S. dollar."

Gold, which has risen 24% so far this year, tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation and currency debasement.

Concerns about a surge in coronavirus cases in the United States and in Europe dented investors' appetite for riskier assets. MKTS/GLOB

Silver XAG= rose 1.3% to $23.57 per ounce, platinum XPT= fell 0.6% to $842.09 and palladium XPD= gained 0.9% to $2,210.67.

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