Gold prices reached their highest levels on Monday while the dollar hit its three-year lows against a basket of currencies.
As the dollar weakens, it usually boosts the gold’s appeal as an alternative asset. Dollar-priced commodities end up being cheaper for holders of other currencies.
Comex gold futures were at $1,343.70 a troy ounce, increasing by 0.7 percent or $8.70 from the previous close. It hit the best level at $1,345.00 in the earlier session on September 8.
Gold prices matched a fifth week of gains in a row as it rose 1.4 percent last week.
Comex trading will be closed on Monday due to Martin Luther King Day holiday in the U.S. All electronic transactions will be put on hold till Tuesday’s trades for settlement.
In other metals, silver futures rose 1.5 percent or 0.25 cents to $17.39 a troy ounce.
Palladium’s prices climbed to an all-time peak of $1,128.60 an ounce due to high demand for the auto industry.
Platinum also rose, up 0.9 percent to $1,004.80 an ounce.
March copper increased by 2 percent to $3.281 a pound.
The Dollar’s fall
The dollar was on the defensive end early on Monday. This followed investors’ continued concerns regarding the risk of tighter policies in Japan and Europe.
The dollar index tracks the greenback’s performance against a basket of six major currencies. The index dropped 0.1 percent to 90.53 after falling to its lowest since January 2015 at 90.39 one point during the session.
The dollar slid to a six-week low at 110.73 against the yen. On the other hand, the euro was up against the greenback at a three-year peak of 1.2203.
The U.S. is predicted to go through a relatively quiet week when it comes to economic releases. This is mostly due to a report on the housing sector which is expected to draw the most attention.
Aside from the housing-related data, there will also be surveys on the manufacturing conditions in the Philadelphia and New York regions this week. Another one will be the figures in industrial production and preliminary Michigan consumer sentiment.
Other events in spotlight will be the Fed’s Beige Book, speeches from Chicago Fed President Charles Evans, Cleveland Fed Boss Loretta Mester and Fed Governor Randall Quarles.
The majority of economists predict that rate hikes will take place in March as per Federal Reserve. A second move higher is believed to arrive in June.
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