PRECIOUS METALS-Gold heads to score weekly rise for weak dollar, US stimulus bets

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PRECIOUS METALS-Gold heads to score weekly rise for weak dollar, US stimulus bets




Archive image. Gold earrings in a jewelry showroom in Mumbai


© Reuters / Niharika Kulkarni
Archive image. Gold earrings in a jewelry showroom in Mumbai


By Asha Sistla

Dec 4 (Reuters) – Gold prices stabilized within a narrow range on Friday and headed for their first weekly gain in a month as the dollar weakened on expectations of additional stimulus in the United States.

* Spot gold was little changed at $ 1,840.90 an ounce at 0940 GMT and has added about 3% so far this week. Gold futures in the United States were up 0.2% at $ 1,844.90.

* “The market now expects higher GDP growth in 2021, especially with the deployment of the vaccine, which will create an environment of appetite for risk,” said Bank of China International analyst Xiao Fu.

* “On the other hand, the weakness of the US dollar and a combination of fiscal and monetary policy, as well as geopolitical risks, are propping up gold. So those two forces occur at the same time.”

* The unprecedented stimulus injected this year has seen gold rise 21% so far, given its attractiveness as a hedge against possible inflation and currency depreciation that could result from the stimulus.

* The US dollar was heading for its worst week since early November, making gold cheaper for holders of other currencies.

* A bipartisan $ 908 billion coronavirus aid bill gained traction Thursday in the US Congress.

* But expectations about the launch of the vaccine added to general optimism about an economic rebound, keeping equity markets near all-time highs.

* Among other precious metals, platinum was up 1.8% at $ 1,047.89 an ounce and palladium was up 1.7% at $ 2,339.80, while silver was up 0.5% at $ 24.19 dollars an ounce and was on track to post a weekly advance of more than 6%.

(Reported by Asha Sistla and Nakul Iyer in Bengaluru; Edited in Spanish by Ricardo Figueroa)

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