Gold holds above US$1,800 as weak dollar checks yield pressure

[BENGALURU] Gold prices steadied above the key US$1,800 per ounce level on Thursday (Dec 30) as a weak US dollar, which makes bullion attractive for holders of other currencies, balanced pressure from firm Treasury yields which erode the metal's appeal.

Spot gold was steady at US$1,803.03 per ounce by 12.59 am GMT. US gold futures were down 0.1 per cent at US$1,804.30.

Benchmark 10-year US Treasury yields firmed near a 1-month peak, raising the opportunity cost of holding non-interest paying gold.

However, the dollar index steadied near a 1-month low as investors looked beyond a surge in Omicron Covid-19 variant cases and favoured riskier currencies.

Asian share markets got off to a listless start on Thursday as the spread of Omicron clouded the last trading day of the year for many exchanges around the globe, while oil was close to finishing 2021 with gains of more than 50 per cent.

South Korea's factory output in November far outperformed expectations on strong export orders for cars and chips, government data showed.

The US trade deficit in goods mushroomed to the widest ever in November as imports of consumer goods shot to a record ahead of the second straight Covid-19-distorted holiday shopping season along with industrial supplies, while exports slipped after a historic gain a month earlier.

Gold was on track for its biggest annual decline since 2015, having fallen nearly 5 per cent so far this year.

Analysts have said gold trading is likely to remain thin and range-bound this week.

Spot silver was down 0.1 per cent at US$22.79 an ounce, platinum edged 0.1 per cent lower to US$966.71, and palladium fell 0.1 per cent to US$1,982.17.

REUTERS