Gold Dips On Stronger Dollar; Coronavirus Concerns Cap Losses
Gold prices eased on Wednesday due an uptick in the dollar, but uncertainty going into next week's U.S. presidential election and concerns over a spike in coronavirus cases in Europe and the U.S. limited bullion's losses.
- Last Updated: October 28, 2020, 15:33 IST
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Gold prices eased on Wednesday due an uptick in the dollar, but uncertainty going into next week’s U.S. presidential election and concerns over a spike in coronavirus cases in Europe and the U.S. limited bullion’s losses.
Spot gold was down 0.3% at $1,900.52 per ounce by 0931 GMT. U.S. gold futures fell 0.5% to $1,902.30 per ounce.
“The dollar has strengthened, which is pressuring gold a bit. Overall, the gold market is in a wait-and-see mode until the U.S. election,” said Robin Bhar, an independent analyst.
“There is still pretty good buying (on the dips). Investors believe in the long term structural positive factors for gold, like high debt, weakening dollar, fears of inflation, COVID-19 situation.”
The dollar rose 0.5% to a more than one-week high versus its rivals, making gold more expensive for holders of other currencies. [USD/] [MKTS/GLOB]
Meanwhile, President Donald Trump on Tuesday said that an economic relief deal would likely come after the Nov. 3 election despite a rise in infections and a stalling labour market recovery.
Gold, which has risen about 25% so far this year, is considered a hedge against inflation and currency debasement amid the unprecedented global levels of stimulus.
Focus was on the U.S. elections, with Democratic challenger Joe Biden leading Trump in nationwide polls.
“Gold prices are being kept in check by the dollar index. Gold’s adherence to a tight range also indicates that some investors remain sceptical over the prospects of a ‘blue wave’,” said FXTM market analyst Han Tan.
Elsewhere, silver slipped 1.2% to $24.26 per ounce, platinum eased 0.2% to $876.84, while palladium gained 0.2% at $2,335.69.
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