SINGAPORE: Gold edged higher in Asian trade on Monday, hovering near a seven-week peak hit in the previous session, as a weaker dollar and lower US Treasury yields supported prices. Spot gold was up 0.2% at $1,778.91 per ounce by 0640 GMT, after hitting its highest since Feb.25 at $1,783.55 on Friday.
US gold futures were steady at $1,780.10 per ounce.
"At the moment, the combination of a weaker US dollar and easing interest rates is supportive for gold, despite better economic outlook," said Michael McCarthy, chief market strategist at CMC Markets.
"We've got the momentum. But of course we are at a very important point having just got through that $1,765 level. While we hold above the $1,765 level, the outlook for gold is positive in the short term."
"Inflation expectations are holding above 2.5% amid soaring commodities prices. This along with Fed's dovish stance on the monetary policy, is keeping the backdrop supportive for bullion," ANZ analysts said in a note.
Some investors view gold as a hedge against higher inflation that could follow stimulus measures.