By Brijesh Patel
(Reuters) – Gold prices rose to a more than one-week high on Monday, helped by a softer U.S. dollar and some safe-haven demand amid protests in several Chinese cities over the country’s strict COVID-19 curbs.
Spot gold was up 0.3% at $1,760.87 per ounce, as of 1055 GMT, after hitting its highest since Nov. 18 earlier in the session. U.S. gold futures rose 0.5% to $1,762.20.
“The dollar turning a touch lower is helping gold prices now,” independent analyst Ross Norman said, adding if China COVID situation escalates quickly, it would be positive for the gold market.
The dollar fell 0.8% against its rivals, making gold less expensive for other currency holders. [USD/]
Hundreds of demonstrators and police clashed in Shanghai on Sunday night as protests over China’s stringent COVID restrictions flared for a third day and spread to several cities.
China’s COVID protests dented risk appetite as well. [.EU]
Investors’ focus this week will be on Federal Reserve Chair Jerome Powell’s Wednesday speech on the U.S. economy and labour market for clues on the monetary policy outlook.
Higher interest rates increase the opportunity cost of holding the non-yielding metal.
The U.S. Labor Department’s November nonfarm payrolls data due on Friday is expected to provide more clarity on the Fed’s rate-hike path.
Traders are pricing in a 50 basis-point increase at the Fed’s December meeting after minutes of the last policy meeting signalled a slower pace of hikes.
“This month’s largely sentiment driven gains (in gold) will face a swift turnaround if the Fed doesn’t prove as near to slowing down its aggressive rate hikes as initially expected,” Kinesis Money analyst Rupert Rowling said in a note.
Meanwhile, silver eased 0.2% to $21.55, platinum rose 0.5% to $985.33 and palladium was flat at $1,851.63.
(Reporting by Brijesh Patel in Bengaluru; Editing by Shinjini Ganguli)
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