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Gold rises as US dollar weakens on report Trump's election campaign subpoenaed
[BENGALURU] Gold prices rose on Friday as the US dollar weakened after a report that investigators looking into possible Russian interference in the 2016 US presidential election had subpoenaed President Donald Trump's election campaign for documents.
Special Counsel Robert Mueller's team issued the subpoena last month for documents containing specified Russian keywords from more than a dozen officials, the Wall Street Journal reported.
Spot gold had climbed by 0.3 per cent to US$1,282.72 per ounce by 0429 GMT. It is up about 0.5 per cent for the week, in what could be its second straight weekly gain.
US gold futures for December delivery rose 0.4 per cent to US$1,282.70.
"The fall in the dollar and strengthening in Asian currencies have made gold attractive for Asian investors," said John Sharma, an economist with National Australia Bank.
However, uncertainties surrounding a US tax reform bill and a likely interest rate hike by the Federal Reserve next month are sending mixed signals to the market, keeping gold rangebound, he said.
"Prices should likely continue to hover between US$1,260 and US$1,290 in the short-term," he added.
Republican US lawmakers on Thursday took an important step toward the biggest tax code overhaul since the 1980s as the House of Representatives approved a broad package of tax cuts sought by Mr Trump.
"Gold prices will continue a sideways drift in the coming months as rising nominal interest rates in the US keep a lid on investment demand," BMI Research said in a note.
"Prices will grind moderately higher in the longer term as developed market inflation rebounds."
San Francisco Fed President John Williams reiterated his view on Thursday that the US economy is growing strongly enough for the Fed to continue raising rates gradually over the next couple of years to around 2.5 per cent.
Meanwhile, Cleveland Fed President Loretta Mester said on Thursday she feels inflation is poised to pick up, clearing the way for the Fed to continue its gradual process of raising interest rates.
Spot gold is biased to rise above a neutral range of US$1,270-US$1,286 per ounce, and gain further towards US$1,298, according to Reuters technicals analyst Wang Tao.
The US dollar index against a basket of six major currencies was down 0.3 per cent.
In other precious metals, silver was up 0.1 per cent at US$17.098 an ounce, platinum rose 0.4 per cent to US$934.50 and palladium gained 0.3 per cent to US$990.25.
For the week, silver has risen 1.1 per cent, in what could be its best week in five. Platinum is up about 1.1 per cent, heading for a third straight weekly rise, while palladium is down 0.3 per cent.