Gold gains on overall dollar softness, markets eye Fed minutes
Gold prices edged up on Thursday, holding close to a three-month peak as the metal benefited from weakness in the dollar, with the market focus on minutes of the US Federal Reserve’s December policy meeting.
Spot gold rose 0.2 percent to $1,519.76 per ounce as of 1039 GMT, having touched the highest level since Sept. 25 at $1,525.20 on Tuesday. US gold futures were down 0.1 percent at $1,522.30.
“We are seeing a bit of a bounce back in the dollar but if you look at the movements that we saw (in the past few days), it is probably supporting gold in the interim,” said OANDA analyst Craig Erlam.
“There is a bit of a correlation between the two (dollar and bullion) right now, which is what really propelled gold from $1,480 to $1,520,” he said, adding a further upside in dollar could, however, add pressure to gold.
Against key rivals, the dollar inched up about 0.3 percent this session, but was trading not far from its July-2019 low touched on Tuesday.
Beijing’s decision to ease monetary policy further supported bullion, Erlam added.
China’s central bank on Wednesday said it was cutting the amount of cash that all banks must hold as reserves, releasing funds to shore up the slowing economy.
Bullion prices posted their biggest annual rise in nearly a decade in 2019, boosted by the drawn-out trade war between the United States and China that dragged on global economic growth.
Many analysts said prices were likely to rise further in 2020, with shaky growth and global stock markets potentially looking unsustainable at record highs.
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