Gold rises on dollar dip, hopes for U.S. relief package
By Asha Sistla
(Reuters) - Gold rose about 1% on Monday as the dollar retreated and expectations for a U.S. stimulus deal ahead of the Nov. 3 presidential elections bolstered bullion's appeal as an inflation hedge.
Spot gold rose 0.5% to $1,908.22 per ounce by 11:59 a.m. ET (1559 GMT). U.S. gold futures rose 0.2% to $1,910.40.
Gold is strengthening on the dollar's downtrend and "the belief that some kind of stimulus package is going to come through in the next 48 hours," said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
"People believe that we're going to go into an inflationary period into the next quarter. So they're starting up front on that."
The dollar slipped 0.5% versus rivals, making gold less expensive for holders of other currencies. [USD/]
U.S. House Speaker Nancy Pelosi said on Sunday that differences remained with the Trump administration on a wide-ranging relief package but that she was optimistic legislation could be pushed through before Election Day.
Gold has gained about 26% so far this year as investors sought refuge from a worsening coronavirus pandemic, and risks of inflation and currency debasement as global central banks slashed interest rates while pumping out unprecedented stimulus to contain the economic blow.
Further underpinning safe-haven demand for bullion were concerns surrounding fresh coronavirus-led restrictions in Europe and elsewhere as worldwide infections crossed over 40 million, as well as uncertainty over the U.S. elections.
Silver climbed 1.6% to $24.56, having hit a near one-week peak.
Citi said in a note it expected silver to rally to $40 over the next 12 months, on sustained investor demand and a recovery in industrial consumption in 2021.
Platinum fell 0.2% to $858.49 per ounce, while palladium edged up 0.1% to $2,334.40.
(Reporting by Asha Sistla in Bengaluru; Editing by Richard Chang)
