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Gold held near its highest in nearly two
months on Wednesday, supported by a softer dollar as investors
awaited a verdict from the U.S. Senate run-off election in
Georgia.
Spot gold rose 0.1% to $1,951.31 per ounce by 0835
GMT, having hit a nearly two-month peak of $1,954.97 earlier in
the session. U.S. gold futures eased 0.1% to $1,952.80.
“The market is very reactive to the polls and liquidity is
pretty thin. (But) It will hoover up dips in gold regardless of
who wins because the general view right now is reflation trade,”
said Axi chief global market strategist Stephen Innes.
Gold could still reach $2,000 by the month-end, Innes added.
The U.S. dollar slipped as Democrats took the lead in runoff
votes that will determine control of the U.S. Senate and
possibly pave the way for a big spending administration under
President-elect Joe Biden.
Bullion tends to gain from widespread stimulus measures
since investors consider it a hedge against possible inflation
that could result from the stimulus.
A weaker dollar also makes dollar-denominated commodities
cheaper for other currency holders.
Capping gold’s gains, U.S. 10-year Treasury yields
hit their highest since March.
Higher bond yields increase the opportunity cost of holding
"soft" - Google News
January 06, 2021 at 04:05PM
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Gold near 2-month peak on soft dollar, U.S. verdict in focus - Financial Post
"soft" - Google News
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