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Gold slips on strong dollar, U.S. stimulus doubts

Senin, 26 Oktober 2020 / 16:33 WIB
Gold slips on strong dollar, U.S. stimulus doubts
ILUSTRASI. Gold fell below the key psychological level of $1,900 on Monday to its lowest in more than a week.

Sumber: Reuters | Editor: Wahyu T.Rahmawati

KONTAN.CO.ID - JAKARTA. Gold fell below the key psychological level of $1,900 on Monday to its lowest in more than a week, pressured by a firmer dollar and stalled progress in talks for a new U.S. coronavirus aid package. Spot gold fell 0.2% to $1,897.71 per ounce by 0908 GMT, after hitting $1,890.19, its lowest since Oct. 15. 

U.S. gold futures fell 0.3% to $1,900.50. "There seems to be a lack of impetus to find extra buyers (for gold)... A lot of it is because we're trading in the looming shadow of the U.S. elections and stimulus speculation," said IG Markets analyst Kyle Rodda. 

The dollar rose 0.3% against a basket of other currencies. U.S. House Speaker Nancy Pelosi on Sunday said the Trump administration was reviewing the latest plan for more COVID-19 relief and that she expected a response on Monday. 

But with the presidential elections fast approaching, analysts said a victory for Democrat rival Joe Biden could help gold rally on a potential large stimulus package, especially amid COVID-19 cases surging in the United States. 

Read Also: Oil falls more than 2% as Covid-19 infections raise demand concerns

France registered a record increase in infections over the weekend and Spain announced a state of emergency as cases surged through Europe. Widely viewed as a hedge against inflation and currency debasement, bullion has gained 25.1% this year as central banks and governments unveiled unprecedented stimulus to cushion the economic fallout from the pandemic. 

A break below support at $1,887 per ounce could push gold lower to $1,872, according to Reuters technical analyst Wang Tao. Elsewhere, auto-catalyst metals palladium and platinum dropped 1.5% to $2,356.16 and 1.4% to $888.59 respectively. 

"Although supply shocks for the pair have eased in recent weeks, Chinese car sales continue to eclipse expectations, which paints a bullish picture into the year end and should keep prices buoyant," MKS PAMP said in a note. Silver fell 1.9% to $24.12 per ounce. 

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