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Gold pushes higher as healthcare vote delay weighs on dollar, stocks

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Investing.com - Gold prices edged higher in European trade on Wednesday, as the U.S. dollar and global stock markets pulled back, boosting the appeal of the yellow metal.

Comex gold futures were at $1,252.52 a troy ounce by 3:05AM ET (0705GMT), up $5.55, or around 0.5%. Gold edged higher Tuesday to notch its fourth gain in five sessions.

Also on the Comex, silver futures ticked up 17.7 cents, or roughly 1.1%, to $16.76 a troy ounce.

The dollar nursed its losses, having come under pressure overnight after U.S. Senate Majority Leader Mitch McConnell delayed a vote on healthcare legislation until after the Senate's July 4 recess, hoping to get more support from Republican senators.

Market participants are concerned that the Trump administration will find it hard to follow through with tax cuts and fiscal stimulus steps, without first getting the healthcare bill passed.

The dollar index, which measures the greenback against a basket of six major currencies, was 96.09 in early trade, after falling to its lowest since November at 95.92 in overnight trade.

Meanwhile, European and Asian stock markets slumped in wake of a downbeat performance on Wall Street overnight, where shares fell across the board with the benchmark S&P 500 posting its biggest one-day drop in about six weeks.

Investors were also digesting remarks by Fed Chair Janet Yellen, who reiterated Tuesday that the U.S. central bank would continue to gradually raise interest rates.

Markets have been closely watching speeches from Fed officials after the bank stuck to its projection for one more rate hike this year at its meeting earlier this month despite the subdued inflation outlook.

Recent weakness in economic data has raised questions over the Fed's plans to tighten monetary policy, with investors now expecting that the pace of its tightening could be much slower than policymakers want.

Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.

Among other precious metals, platinum held steady at $920.70, while palladium firmed at $859.52 an ounce.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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