Gold hits 7-week highs on weaker US dollar after Trump briefing

[BENGALURU] Gold rose to a seven-week high on Thursday on a weaker US dollar after US President-elect Donald Trump provided little clarity on future fiscal policies at a press briefing.

Spot gold was up 0.4 per cent at US$1,196.06 per ounce, after touching a high of US$1,198.58, its best since Nov 23.

US gold futures fell 0.2 per cent to US$1,193.70 per ounce.

In his first press briefing as US president-elect, Mr Trump presided over a wide-ranging session that lasted longer than expected but contained no details on tax cuts and infrastructure spending, analysts said.

"There is some kind of uncertainty in Trump's policies and the dollar's upside is also being questioned by the markets,"Argonaut Securities analyst Helen Lau said.

"We need more positive development in US economic fundamentals before the dollar can go higher," Ms Lau said, adding that the markets were disappointed in Mr Trump's speech.

Mr Trump's campaign calls for tax cuts and more infrastructure spending have boosted US shares and the US dollar, as well as driving a selloff in Treasuries, but his protectionist statements and a flurry of off-the-cuff Tweets have kept many investors from adding to risky positions.

The US dollar index, which tracks the US currency against a basket of six major counterparts, was down 0.3 per cent at 101.470, having hit a one-week high on Wednesday.

"The dollar will roll back a good proportion of its gains over the course of the month in January and gold should benefit as a result if Trump team hits the ground running and continues to give more impressions of disarray than what has been apparent so far," INTLFC Stone analyst Edward Meir said in a note.

The outlook for US rates may become a little clearer when Federal Reserve Chair Janet Yellen appears at a webcast town hall meeting with educators on Thursday.

A host of Federal Reserve presidents including Philadelphia, Chicago, Atlanta, Dallas and St Louis will also speak on a range of issues.

Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding the non-yielding asset while boosting the US dollar, in which it is priced.

Spot silver rose 0.6 per cent to US$16.81 an ounce.

Platinum was up 0.6 per cent to US$977.65, after touching a high of US$986.10, its best since Nov 10.

Palladium rose by 0.6 per cent to US$758.40.

REUTERS