Jan 6 (Reuters) – Gold hit a new two-month high on Wednesday as the dollar weakened on growing expectations of a Democratic victory in the Georgia US Senate runoff, which would likely create additional fiscal stimulus.
Spot gold
XAU =
rose 0.4% to $ 1,956.86 an ounce at 1029 GMT after hitting an almost two-month high of $ 1,959.01 at the start of the session. US.
Gold futures
GCv1 rose 0.3% to $ 1,960.40.
« A Biden win in Georgia opens the gates to much greater incentive. The markets have been expecting this through higher moves in the past few days, » said Ross Norman , an independent analyst, citing US President-elect Joe Biden.
« Whether this will turn into (something) productive later on remains to be seen, but it is clear that they will add sizeable debt to sizeable debt, and so do it’s good for gold. «
Democrats took the lead in runoff elections that will control the US Senate and potentially pave the way for a major spending management under Biden. Gold bars are seen as a hedge against inflation that will likely result from record fiscal stimulus.
That
Dollar index
fell to new 2-1 / 2 year lows making gold bars cheaper for other currency holders. US DOLLARS /
In the meantime, the minutes of the US Federal Reserve’s December 15-16 meeting at 1900 GMT are due.
The Fed may decide to provide further monetary stimulus as soon as it becomes clearer Picture of how the US Congress is doing, said Howie Lee, an economist at OCBC Bank.
In other metals, silver
XAG =
gained 0.7% to $ 27.77 an ounce. platinum
XPT =
fell 0.2% to $ 1,109.11 while palladium
XPD =
rose 0.2% to $ 2,471.01.
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