Gold rose to a six-week peak on Tuesday, supported by earlier weakness in the dollar ahead of a news conference on Wednesday by US President-elect Donald Trump. The market is looking for more clues on Trump's spending plans in the first speech since his shock election win in November.
The pound steadied and stocks rose world-wide after earlier weakness in the sterling and European equity markets on fears of a "hard" Brexit after British Prime Minister Theresa May said over the weekend she was not interested in Britain keeping "bits" of its EU membership. Gold, often seen as an alternative investment during times of political and financial uncertainty, benefited from the risk-averse sentiment in the market. Spot gold hit its highest since November 30 at $1,190.46 an ounce, and was up 0.4 percent at $1,185.36 an ounce by 3:19 pm EST (2019 GMT).
US gold futures settled up 0.05 percent at $1,185.50. ABN Amro commodity strategist Georgette Boele said the combination of a soft dollar, lower US yields and risk aversion created a supportive environment for gold. "We have this Trump conference coming up tomorrow and the market seems to be a bit nervous ahead of it," Boele said, adding that this sentiment would be short-lived as US interest rates are expected to rise, denting gold.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell on Monday. Silver was up 1.3 percent at $16.77 an ounce, after rising to $16.90, its highest since December 15. Platinum bucked the trend, slipping 0.2 percent to $972.50, while palladium rose 0.4 percent at $761.45.
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