Gold rises as economic uncertainty prevails, dollar softens
By Nakul Iyer
(Reuters) - Gold prices gained on Friday buoyed by a weaker dollar and lingering concerns over an economic recovery from the damage inflicted by the coronavirus pandemic that were underscored by elevated weekly U.S. jobless claims data.
Spot gold climbed 0.6% to $1,953.80 per ounce by 0934 GMT and was on track for a second straight week of gains, rising 0.7% so far.
U.S. gold futures were up 0.7% at $1,963.60 per ounce.
Gold is being propped up by the weaker dollar, but prices are likely to remain "in a lateral range between $1860 and $2000," said ActivTrades chief analyst Carlo Alberto De Casa.
"The scenario remains unchanged with the main trend still positive."
U.S. weekly jobless claims report on Thursday showed a smaller-then expected decline in new claims, weighing on the dollar and bolstering the appeal of gold as an investment alternative.
"The path into the post-pandemic era still poses downside risks for the global economy, and if crystallized, could help bullion realize more of its upside," FXTM market analyst Han Tan said.
Low interest rates globally and widespread stimulus measures have helped gold gain over 28% so far this year, as they lower the opportunity cost of holding non-yielding bullion and bolster its appeal as a hedge against inflation risk.
Continuing the trend, the U.S. Federal Reserve on Wednesday vowed to keep interest rates near zero for a long time.
On Thursday, the Bank of England said it was considering negative interest rates, while the Bank of Japan signalled readiness to ramp up stimulus.
With the focus now on the U.S. presidential election on Nov. 3, any delay over its outcome could reignite the safe-haven play and potentially push gold to new record highs, FXTM's Tan said.
Silver rose 0.1% to $27.13 per ounce, while platinum rose 0.5% to $944.69 and palladium edged up by 0.1% to $2,337.81.
(Reporting by Nakul Iyer and Eileen Soreng in Bengaluru; Editing by Ramakrishnan M and Tomasz Janowski)
