Gold prices edged higher on Monday to recover from an over seven-month low touched in the previous session as the dollar weakened, although higher U.S. Treasury yields capped bullion gains.
Spot gold rose 0.3% to $1,787.31 per ounce by 0100 GMT, having touched its lowest since July 2 at $1,759.29 on Friday. U.S. gold futures gained 0.4% to $1,784.20.
The dollar eased against rivals, making gold affordable for holders of other currencies.
Benchmark U.S. Treasury yields hit a near one-year peak, increasing the opportunity cost of holding bullion, which pays no interest.
United States President Joe Biden’s push for a $1.9 trillion COVID-19 relief bill took a step forward on Friday as a U.S. House of Representatives committee unveiled the legislation Democrats hope to pass by late next week.
The risks of ongoing business failures in the United States “remain considerable” even as the economy emerges from the coronavirus pandemic, the Federal Reserve said on Friday in its semi-annual monetary policy report to Congress.
Bitcoin hit a market capitalization of $1 trillion as it rose to yet another record high on Sunday, touching $58,000, countering analyst warnings that it is an “economic side show” and a poor hedge against a fall in stock prices.
Gold Demand India Grows
Physical demand in India last week surged as local prices dropped to their lowest levels since June last year, with buying expected to pick up in other Asian centers after the Chinese Lunar New Year holiday week.
Hedge funds and money managers slashed their bullish positions in COMEX gold and raised them in silver contracts in the week to Feb. 16, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
Silver gained 1.3% to $27.56 an ounce. Platinum rose 1.7% to $1,295.94, while palladium climbed 1.6% to $2,415.38.