NEW YORK: Gold firmed on Thursday as the dollar fell and investors clung to hopes of an eventual breakthrough in negotiations over a fresh US coronavirus aid package. Spot gold gained 0.3% to $1,837.06 per ounce at 12:47 p.m. EST (1747 GMT). It earlier hit its highest since Nov. 23 at $1,843.80, but gave up gains following a lower-than-expected US jobless claims number.

US gold futures were up 0.6% at $1,840.80. US lawmakers sought to hammer out an agreement on aid for an ailing US economy with signs that a $908 billion bipartisan proposal was gaining traction, while US President Donald Trump expressed support for a relief bill.

Joe Biden coming to power in Washington could lead to more stimulus, said Daniel Pavilonis, senior market strategist at RJO Futures. But ultimately, "the gold market expected a lot more stimulus" than is being negotiated, he added, capping bullion's upside.

Optimism surrounding a stimulus deal and progress over Covid-19 vaccines kept the dollar index near a more than two-year low, buoying appeal for gold among investors holding other currencies.

"Stimulus talks and further dollar weakening are lending more support to gold," said StoneX analyst Rhona O'Connell in a note.

Gold, considered a hedge against inflation and currency debasement, has risen over 21% this year, benefiting from near-zero interest rates and the risk of higher inflation likely to result from massive stimulus globally to ease the economic blow from the pandemic.

Platinum hit a near eleven-month peak at $1,034 per ounce. It was last up 1% at $1,024.16. Platinum has consolidated above $1,000 on positive global growth sentiment, with initial targets extending towards $1,040 as exchange traded fund interest drives price action related to deficits forecast in 2021, MKS PAMP said in a note. Palladium fell 4.3% to $2,295.88 per ounce, after plunging as much as 7.3% and silver was down 0.5% at $23.98.

Comments

Comments are closed.