Picture: 123RF/REAL ROCKING
Picture: 123RF/REAL ROCKING

Bengaluru — Gold prices ticked up on Friday as investors took advantage of an easing dollar to buy the metal after a steep sell-off sent bullion to a near two-month low in the last session and set it on track for its biggest weekly fall in six.

Spot gold rose 0.1% to $1,869.79 an ounce by 9.38am GMT, while US gold futures were down 0.1% at $1,875.00.

“The fact that the dollar is flat on the day is giving traders a bit of a reason to buy back in to gold,” David Madden, market analyst at CMC Markets UK said. While a huge amount of negativity is priced in here, investors will likely “err on the side of caution” on the pandemic and buy gold, Madden said.

The dollar index rally to a two-month high lost steam, making gold more attractive for holders of other currencies. The dollar remained on course for its biggest weekly gains since early April. Bullion was set to post its steepest weekly contraction since mid-August, falling 4.1%.

There is still “fatigue” in the market as gold has already priced in a lot of the favourable factors and there are a lot of investors already in the market, so it is unlikely that there will be many new ones, ABN Amro analyst Georgette Boele said. But news that the Democrats are working on a $2.2-trillion package, after US Fed officials urged for more fiscal stimulus, offered some respite to investors’ hopes.

Gold is often considered a hedge against inflation, currency debasement and economic uncertainty.

In other metals, silver fell 0.3% to $23.14 an ounce and platinum rose 0.9% to $856.66. Both metals are on track for their biggest weekly falls since mid-March. Palladium edged 0.2% down to $2,221.64 an ounce.

Reuters

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