Gold eases after Trump's discharge, weaker US dollar cushions decline

[BENGALURU] Gold prices dipped on Tuesday, as equities gained after US President Donald Trump was discharged from hospital after treatment for a coronavirus infection, though a softer dollar limited losses.

Spot gold fell 0.1 per cent to US$1,911.22 per ounce by 3.34am GMT. Prices hit US$1,918.36 on Monday, a peak since Sept 22.

US gold futures were down 0.2 per cent at US$1,915.90.

The market is still in a bit of a risk-on mood right now and that's tempering gold, said Stephen Innes, chief market strategist at AxiCorp.

"There's a bit of uncertainty kicking in mostly over president Trump's recovery and on what that's going to do to polling numbers." Asian stock markets rose to a two-week high after the US president returned to the White House from hospital following treatment for Covid-19 and on rising prospects for a fresh US stimulus package.

However, the severity of Mr Trump's illness has been the subject of intense speculation.

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US House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin were preparing to continue talks on the new coronavirus relief package again on Tuesday.

Gold was also weighed down by mild profit-booking, analysts said.

Meanwhile, a weaker US dollar and progress on fresh stimulus talks limited gold's decline.

The dollar index was down 0.1 per cent against rivals making gold cheaper for holders of other currency.

"Given that US dollar index is falling, this will likely support gold prices and cushion the downside," said Margaret Yang, a strategist with DailyFx, which covers currency, commodity and index trading.

"Overall trend (in gold) has turned bullish... US$1,910 will be a critical support level at the moment." Among other precious metals, silver rose 0.1 per cent to US$24.37 per ounce, palladium eased 0.2 per cent to US$2,357.77, while platinum was steady at US$897.27.

REUTERS