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Gold inches higher on subdued US dollar; Trump-Biden debate in focus

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Gold edged up on Monday as the US dollar slipped off a two-month peak it hit last week, due to caution as political uncertainty built ahead of the first presidential election debate between US President Donald Trump and his Democratic rival Joe Biden.

[BENGALURU] Gold edged up on Monday as the US dollar slipped off a two-month peak it hit last week, due to caution as political uncertainty built ahead of the first presidential election debate between US President Donald Trump and his Democratic rival Joe Biden.

Spot gold rose 0.1 per cent to US$1,861.02 per ounce by 3.26am GMT.

US gold futures were down 0.1 per cent at US$1,863.70.

"Gold is going to be driven by the tenor of the US dollar," said Stephen Innes, chief market strategist at AxiCorp.

"The big move is going to probably occur after the presidential debate when we have a better read on where the polls are going to be sitting." The dollar index was down 0.2 per cent against rivals, slightly off a two-month peak hit last week.

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A firmer dollar makes bullion more expensive for holders of other currencies.

Mr Trump and Mr Biden will have their first presidential election debate on Tuesday.

Investor focus will also be on a new fiscal support package after US House Speaker Nancy Pelosi said on Sunday a deal could be reached with the White House on a coronavirus relief package and that talks were continuing.

"I don't think they are expecting a big deluge but some sort of middle ground," Mr Innes added.

Global central banks and governments have released massive stimulus to prop up their economies from the impact of the Covid-19 pandemic, pushing gold more than 20 per cent higher this year.

However, prices have retreated by about 10 per cent since hitting a record peak in August.

Speculators reduced their bullish positions in Comex gold and silver contracts in the week to Sept 22, data from US Commodity Futures Trading Commission showed.

Among other precious metals, silver dipped 0.2 per cent to US$22.81 per ounce, platinum gained 0.5 per cent to US$851.46 and palladium rose 0.1 per cent to US$2,218.76.

REUTERS

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