Gold clings near $1,800 on soft dollar as China relaxes Covid-19 curbs


pulled back slightly from a five-month high on Monday as the dollar pared some losses but the metal still held near the key $1,800 level, buoyed by news of top bullion consumer relaxing COVID restrictions.


Spot ticked 0.1% lower to $1,796.17 per ounce by 0938 GMT, after touching its highest level since July 5 at $1,809.91.


U.S. futures were little changed at $1,809.20.


The dollar hit a more than five-month low earlier in the session, but has since pared some of those losses. A weaker dollar makes gold cheaper for overseas buyers. 


“China’s easing of its zero COVID stance is enabling gold prices to hang on to recent gains,” said Han Tan, chief market analyst at Exinity, adding positive reinforcements are allowing bullion to stay within touching distance of the psychological $,1800 mark.


China, traditionally the world’s biggest bullion consumer, may announce 10 new COVID-19 easing measures as early as Wednesday, two sources with knowledge of the matter told Reuters.


This also means gold demand will increase in the region, further supporting prices, said Matt Simpson, a senior market analyst from StoneX. [GOL/AS]


Gold traders were still focused on the U.S. Federal Reserve’s rate hike path, with a recent softening of the central bank’s aggressive stance giving a fillip to non-yielding bullion.


Market participants see a 91% chance of a 50-basis-point rate hike at the Fed’s meeting this month.


“The near-term path of gold will be strongly influenced by the upcoming US CPI data. We still look for further rate hikes weighing on gold over the coming weeks,” UBS analyst Giovanni Staunovo said.


November CPI data is scheduled to be released on Dec. 13.


Elsewhere, spot silver fell 0.7% to $22.955 per ounce, while platinum rose 0.1% to $1,015.15.


Palladium climbed 0.9% to $1,916.56.


 


 

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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