NEW YORK: Gold rose more than 1% on Friday as a retreat in the dollar enticed investors to snap up the bullion following its recent sell-off.
Spot gold rose to $1,772.80 per ounce by 10:26 a.m. EDT (1426 GMT), after hitting its highest in more than a week at $1,774.30, in a sharp recovery from over four-month lows touched on Monday.
US gold futures rose 1.4% to $1,775.80.
The dollar index fell 0.4% and US benchmark 10-year treasury yields also weakened, bolstering gold’s appeal.
Providing further support to bullion was increased physical demand, particularly from top consumers India and China, where premiums rebounded to multi-month highs.
TD Securities commodity strategist Daniel Ghali said gold’s pull back from Monday’s lows was largely driven by technicals, with increased central bank purchases providing additional support.
“But, this pullback could just be a temporary move higher,” Ghali said, noting that speculative interest was waning, amid rising expectations that the US Federal Reserve could cut back on economic support sooner.
The taper bets got a fillip from a strong US jobs report last week.