Home / News / World /  Gold climbs to one-week peak as dollar slips on US stimulus

Gold prices rose as much as 1.3% on Monday, as the US dollar slipped after the US President Donald Trump signed a long-awaited pandemic aid bill, while liquidity remained low on account of the holiday season.

Spot gold gained 0.4% to $1,882.96 per ounce by 0942 GMT, after earlier hitting its highest since Dec. 21 at $1,900.04. U.S. gold futures were up 0.2% to $1,886.60.

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"The only thing that is helping gold at the moment is because the dollar is lower and yields are not so much higher," said ABN Amro analyst Georgette Boele adding that, "we have holiday season and there's no liquidity."

The dollar index was down 0.3% against rivals, slipping to a one-week low, lifting bullion's appeal for other currency holders. Markets in Britain remained closed on Monday for the Boxing Day holiday.

Underpinning bullion, Trump on Sunday signed into law a $2.3 trillion pandemic aid package, restoring unemployment benefits to millions of Americans and averting a partial federal government shutdown.

"Even without extra stimulus, gold could climb higher ... Trump's signature (on the stimulus bill) was the last major risk point to the bull market," said Jeffrey Halley, a senior market analyst at OANDA. Gold is seen as a hedge against inflation likely to result from large stimulus measures.

"Gold prices found support just below $1,800 per ounce earlier and it moved below the 200-day moving average and now it's above again - so that gives a bit more optimism on the outlook for at least the start of 2021," added ABN Amro's Boele.

Silver was up 1.9% at $26.33 an ounce, after hitting a one-week peak of $26.75 earlier in the session. Platinum climbed 1% to $1,033.50 and palladium rose 0.6% to $2,362.86.

This story has been published from a wire agency feed without modifications to the text.

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