Precious: Gold edges higher on weaker dollar, U.S. yields

CPM

24/05/2021 15:46

(New throughout, adds comments, updates prices)
    * U.S. yields, dollar eases
    * Markets await U.S. data, further policy clues from Fed

    By Sumita Layek
    May 24 (Reuters) - Gold inched higher on Monday as a weaker
dollar and U.S. Treasury yields bolstered its appeal, while
investors awaited key data this week to assess the pace of
economic recovery in the United States.
    Spot gold  XAU=  was up 0.1% at $1,882.61 per ounce at 10:25
a.m. EDT (1425 GMT), having last week reached its highest since
Jan. 8 at $1,889.75. U.S. gold futures  GCv1  gained 0.3% to
$1,881.50.
    A tick lower in the dollar and U.S. yields is acting in
gold's favour, Bob Haberkorn, senior market strategist at RJO
Futures said, adding stronger equity markets were providing a
counterweight.  .N 
    The dollar was pinned near three-month lows, while U.S
Treasury yields were subdued, reducing the opportunity cost of
holding non-interest paying bullion.  USD/   US/ 
    Investors now await to hear if Federal Reserve speakers this
week will stick to a patient policy, while awaiting data
including U.S. gross domestic product, jobless claims and
durable goods.
    "If (data) comes out substantially better-than-expected that
would probably be bearish for gold, because the likelihood of a
Fed taper (of its bond-buying programme) will be sooner rather
than later," Haberkorn said, adding if the data is
worse-than-expected, gold could trade north of $1,900 fairly
quickly.
    The recent crash in bitcoin  BTC=BTSP  was also providing
support to gold, analysts said.  urn:newsml:reuters.com:*:nL2N2NA09B    
    "Gold prices are very strong at these levels. There are any
number of things to scare investors into wanting to buy gold,
but we also have a situation where in Europe, U.S. and Canada,
where the vaccines are starting to have a positive effect," said
Jeffrey Christian, managing partner of CPM Group.
    "The economies are reopening and economic activity is strong
... Maybe gold prices could back off a little bit."
    Elsewhere, palladium  XPD=  fell 0.8% to $2,761.17 per
ounce, silver  XAG=  gained 1% to $27.78, and platinum  XPT= 
rose 0.7% to $1,175.13.

 (Reporting by Sumita Layek in Bengaluru. Editing by Mark
Potter)
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