PRECIOUS-Gold edges lower from one-month high as dollar ticks up

  • Reuters
  • Commodities News
PRECIOUS-Gold edges lower from one-month high as dollar ticks up
Credit: © Reuters.

(Updates prices)

* Gold has gained about 2.5% so far this week

* Safe-haven demand to push gold towards $2,300 next year-Goldman

* Interactive graphic tracking global spread of coronavirus:

By Asha Sistla

Dec 18 (Reuters) - Gold prices retreated on Friday from a one-month peak scaled in the previous session, as the dollar bounced back from lows, while investors pinned hopes on a U.S. fiscal stimulus deal.

Spot gold XAU= edged lower by 0.1% to $1,884.71 per ounce by 1202 GMT. U.S. gold futures GCv1 fell 0.1% to $1,887.70 per ounce.

Having reached its highest since Nov. 16 on Thursday, the precious metal was up about 2.5% for the week and set for a third weekly gain.

"What you're seeing in terms of the gold markets today is a little bit of dollar strength after a very poor week for the U.S. dollar and a very good week for gold," said Michael Hewson, chief market analyst at CMC (NS: CMC ) Markets UK.

"If you've taken out a long position in gold this week, then you're going to want to pare back some of that heading into the weekend ... it's sensible in the last four trading weeks of 2020 that you see a little bit of profit taking."

The dollar index .DXY rose 0.1%, just above a more than two-year trough, dimming gold's appeal for other currency holders. USD/

U.S. Congressional lawmakers scrambled to pass a coronavirus aid package on Thursday, even as Republicans insisted that expiring U.S. Federal Reserve's lending programs can't be revived. also said gold would find support from the Fed's promise to continue its bond-buying programme until "substantial further progress" is seen in restoring full employment and hitting its 2% inflation target. rising inflation expectations, weakening dollar and lofty valuations in some risky assets, demand for safe-haven inflation hedges should remain supported next year, continuing to push gold towards our $2,300/toz target," Goldman Sachs (NYSE: GS ) said in a note.

Silver XAG= slipped 0.9% to $25.80 an ounce, platinum XPT= rose 0.2% to $1,046.50 and palladium XPD= eased 0.3% to $2,333.26 but was up about 0.6% for the week.

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