Gold steadies near record high as dollar stumbles

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Gold steadied on Thursday after hitting a record high in the previous session as dismal U.S. jobs data hammered the dollar, while increasing worries about a recovery in the pandemic-ravaged global economy kept demand solid for the metal.

Spot gold was up 0.1% at $2,042.14 per ounce by 0351 GMT, after hitting an all-time high of $2,055.10 on Wednesday. U.S. gold futures rose 0.4% to $2,056.60.

“Markets are coming to terms with the idea that we’re going to have slow growth for a while,” said DailyFx currency strategist Ilya Spivak, adding that low or negative interest rates were pushing capital into assets like gold that offer nominally better returns.

Gold has rallied more than 34% this year as it is considered an asset that should hold its value while the coronavirus crisis and money printing by central banks erode the value of others.

However, technical indicators point to signs of exhaustion, with DailyFx’s Spivak saying “we might get a pause relatively soon, at least to consolidate.” Adding fuel to gold’s run, rival safe-haven dollar held close to its lowest level in more than two years versus key rivals, after three Federal Reserve policymakers warned the pandemic would continue to hurt the U.S. economy, with cases in the country topping 4.7 million.

Also pressuring the dollar, data showed U.S. private payrolls growth slowed sharply in July. “The only real cure to claw back some economic dignity is that global interest rates remain low for as far as the eye can see and even redoubled amounts government stimulus,” Stephen Innes, chief market strategist at financial services firm AxiCorp, said in a note. Investor focus is now on negotiations over a new U.S. stimulus package.

Silver eased 0.2% to $26.96 per ounce after hitting its highest since April 2013 in the last session.

Platinum rose 0.1% to $968.46 and palladium was steady at $2,183.35.s2.reutersmedia.net

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