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Gold gains on US dollar slide, hopes for US stimulus
[BENGALURU] Gold rose on Thursday, as an easing dollar and signs of progress in talks for fresh US stimulus measures bolstered the metal's appeal.
Spot gold rose 0.7 per cent to US$1,898.79 per ounce by 7.07am GMT, starting October on a positive note after recording its biggest monthly drop since late November 2016 in September.
US gold futures were 0.3 per cent at US$1,902.00 per ounce.
"There's a bit of relief that the dollar rally has for the most part ended and it seems many investors are more focused on the headwinds ahead of the global economic recovery," said Edward Moya, a senior market analyst at Oanda in New York.
The dollar index slipped 0.2 per cent against its rivals to hover near a one-week low, making gold less expensive for investors who hold other currencies.
On Wednesday, US Treasury Secretary Steven Mnuchin said talks with House Speaker Nancy Pelosi "made a lot of progress" on the long-awaited Covid-19 relief legislation.
Governments and central banks worldwide have rolled out unparalleled stimulus measures to revive pandemic-hit economies, helping gold rise more than 25 per cent this year, thanks to its role as a hedge against inflation and currency debasement.
Market participants are now waiting for the US initial jobless claims data due later in the day and the non-farm payrolls report on Friday for clues about the pace of recovery in the world's largest economy.
If US jobs data comes at least in line with expectations and as long as the wage inflation number is strong, that maybe gold negative, said DailyFx currency strategist Ilya Spivak.
Among other precious metals, silver rose 2.4 per cent to US$23.76 per ounce. Platinum hit a more than one-week high of US$908.50 per ounce and was last up 1.9 per cent at US$905.04, while palladium gained 0.8 per cent to US$2,323.96.