Gold jumps over 2% on softer dollar after Democratic midterm wins
GLD•Spot gold rose 2.2% to $4,016.01 an ounce as the US dollar slipped 0.3% after Democratic midterm victories. Investors awaited Friday’s US payrolls report, while traders priced in a 79% chance of a Fed rate hike in December.
1. Gold gains
Spot gold climbed 2.2% to $4,016.01 per ounce by 0619 GMT, while US gold futures for December delivery rose 2.2% to $4,026.90. The US dollar slipped 0.3% as Democrats secured key victories in the midterm elections.
2. Rates and data
A weaker dollar and falling nominal and real Treasury yields supported gold, said Chris Weston, head of research at Pepperstone. Traders saw a 79% chance of a Fed rate hike in December, which would increase the opportunity cost of holding non-yielding bullion. Markets awaited Friday’s US non-farm payrolls report.
3. Other market factors
Weston said demand for protection against a potentially more unpredictable and confrontational Trump administration was also providing a backdrop for gold buyers. Spot silver gained 3.8% to $51.67, platinum rose 2.8% to $1,455.71 and palladium climbed 3.8% to $969.49.
