Gold Gains As Softer Dollar, Economic Concerns Bolster Appeal
Gold prices rose on Friday en route to a second straight weekly gain on a subdued dollar as weak U.S. jobs data dented hopes of an economic recovery.
Spot gold climbed 0.6% to $1,953.70 per ounce by 0710 GMT, up 0.6% so far this week.
U.S. gold futures were 0.6% higher at $1,961.30.
The dollar index was on track for a weekly fall, making gold more attractive for those holding other currencies.
“Virus concerns are still weighing down on economic recovery and when you look at a lot of economic data, it looks like it’s moderating but there is still tremendous damage,” said Edward Moya, a senior market analyst at broker OANDA. “There’s still going to be need for more support.”
The U.S. weekly jobless claims report showed nearly 30 million people were on unemployment benefits at the end of August, laying bare the economic toll from the COVID-19 pandemic.
Near-zero interest rates globally and demand for a hedge against perceived inflation have helped gold gain nearly 29% so far this year.
Continuing the trend, the U.S. Federal Reserve on Wednesday vowed to keep interest rates near zero for a long time.
On Thursday, the Bank of England said it was considering negative interest rates, while the Bank of Japan signalled readiness to ramp up stimulus.
With the focus now on the U.S. presidential election in November, FXTM market analyst Han Tan said a protracted delay over its outcome could reignite the safe-haven play and potentially push gold to new record highs.
On the physical front, Swiss exports of gold to the U.S. all but halted in August while shipments to China and India rose, data showed on Thursday.
Silver rose 0.2% to $27.16 per ounce, while platinum rose 0.2% to $942.06 and palladium was up 0.4% at $2,347.21.
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