US Markets

PRECIOUS-Gold ticks up on U.S. stimulus hopes; strong dollar caps gains

Credit: REUTERS/HEINZ-PETER BADER

Gold prices gained on Friday, holding above the key $1,900 level, as investors pinned hopes on a U.S. coronavirus relief package eventually getting passed, although a firmer dollar limited gains.

(Adds comments, updates prices)

* Gold up 0.5% this week, silver 2.2%

* Interactive graphic tracking global spread of coronavirus: https://graphics.reuters.com/world-coronavirus-tracker-and-maps/

By Nakul Iyer

Oct 23 (Reuters) - Gold prices gained on Friday, holding above the key $1,900 level, as investors pinned hopes on a U.S. coronavirus relief package eventually getting passed, although a firmer dollar limited gains.

Spot gold rose 0.2% to $1,907.96 per ounce by 0747 GMT and is up 0.5% for the week. U.S. gold futures gained 0.3% to $1,909.40 per ounce.

Gold is viewed as a hedge against inflation and currency debasement spurred by stimulus measures.

"Gold is just waiting for U.S stimulus to get through and before the U.S. presidential election there is uncertainty about who is going to win, though it won't change the trajectory for the market," said ANZ commodity strategist Soni Kumari.

Regardless of who wins the election, stimulus measures are likely to be passed and that will weaken the dollar, which along with accommodative central bank policies, will be supportive to gold, Kumari added.

House Speaker Nancy Pelosi on Thursday said negotiators were making progress in talks with the White House over the coronavirus fiscal aid package and a deal could be reached "pretty soon".

"If we get the inflation spark, gold can go to $2,000... without that, I don't think we can get up there," said Stephen Innes, chief global market strategist at Axi.

Meanwhile, the dollar index rose 0.1% against a basket of major currencies, making gold more expensive for other currency holders. [USD/]

Market focus now shifts to the Nov. 3 U.S. presidential election after President Donald Trump and Democratic challenger Joe Biden offered sharply contrasting views on the pandemic at the final presidential debate.

"Gold will find plenty of willing buyers on dips to $1,900 as investors rotate into haven positioning as the U.S. election draws nearer," said Jeffrey Halley, senior market analyst at OANDA.

Silver fell 0.3% to $24.69 per ounce, but was set for a weekly rise. Platinum rose 0.2% to $886.01 and palladium gained 0.5% to $2,384.32.

(Reporting by Nakul Iyer in Bengaluru; Editing by Amy Caren Daniel) ((nakul.iyer@thomsonreuters.com; Within U.S. +1 646 223 8780, Outside U.S. +91 80 6749 0417; Reuters Messaging: nakul.iyer.thomsonreuters.com@reuters.net)) Keywords: GLOBAL PRECIOUS/ (UPDATE 3)

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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