Gold jumps 1% fuelled by easing dollar, stimulus hopes

By Shreyansi Singh and Diptendu Lahiri (Reuters) - Gold prices climbed over 1% to a nine-year high on Thursday, buoyed by weaker dollar and unprecedented stimulus measures to revive coronavirus-hit economies, while rise in U.S. jobless claims underpinned fears of a slow recovery. The number of Americans filing for unemployment benefits unexpectedly rose last week for the first time in nearly four months, suggesting the labor market was stalling amid a resurgence in new COVID-19 cases

Reuters July 24, 2020 00:06:06 IST
Gold jumps 1% fuelled by easing dollar, stimulus hopes

Gold jumps 1 fuelled by easing dollar stimulus hopes

By Shreyansi Singh and Diptendu Lahiri

(Reuters) - Gold prices climbed over 1% to a nine-year high on Thursday, buoyed by weaker dollar and unprecedented stimulus measures to revive coronavirus-hit economies, while rise in U.S. jobless claims underpinned fears of a slow recovery.

The number of Americans filing for unemployment benefits unexpectedly rose last week for the first time in nearly four months, suggesting the labor market was stalling amid a resurgence in new COVID-19 cases.

"It (jobless claims data) tells you that at least here in the States, we still have a long way to go before we recover," said Edward Meir, analyst at ED&F Man Capital Markets.

Spot gold was up 1.2% to $1,893.71 per ounce by 11:34 a.m. ET (1533 GMT), having hit its highest since September 2011 at $1,894.53.

U.S. gold futures rose 1.4 % to $1,891.10.

Non-yielding gold has surged nearly 22% this year, bolstered by low interest rates and the wave of stimulus as economies around the world to support their battered economies.

U.S. Senate Republicans plan to propose another round of direct payments to Americans in the next coronavirus relief bill, a senior aide said on Thursday.

"You have this wave of stimulus practically from every central bank in the world, everybody is putting out stimulus packages, easy money, loans, new debt and all of that is also bullish for gold," Meir added.

Also supporting the bullion, the dollar index <.DXY> dipped 0.2%, having hit a more-than four-month low.

Elsewhere, silver fell 0.4% to $22.94 per ounce, having hit a nearly seven-year high earlier in the session.

Palladium rose 0.05 % to $2,148.68 per ounce, while platinum gained 0.5% to $925.74.

Market tightness in the second half of 2020, supported by monetary and fiscal stimulus measures, should support palladium prices over the next 12 months, UBS said in a note, adding it expected the auto catalyst metal to reach $2,500/oz by mid-2021.

(Reporting by Shreyansi Singh and Diptendu Lahiri in Bengaluru; Editing by Lisa Shumaker)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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