Gold is Up as the Dollar Remains Near Multi-month Highs

Gold was higher in Asia on Monday morning, as the dollar remained near multi-month highs. Concerns over the global spread of COVID-19 and its impact on the economic recovery, on the other hand, drew investors to the yellow metal.

By 12:26 a.m. ET, gold futures had risen 0.28 percent to $1,788.95. (4:26 AM GMT). The dollar, which generally goes in the opposite direction of gold, fell on Monday but remained close to a nine-and-a-half-month high reached the previous week.

Other precious metals rose 0.2 percent, with palladium climbing 1.5 percent after hitting a five-month low of $2,267.65 earlier in the session. Platinum rose 0.3 percent to $998.85 per ounce.

Investors

Investors are now looking to the United States Federal Reserve’s Jackson Hole symposium to indicate the central bank’s timeframe for asset cutting and interest rate hikes. Ahead of the conference, Dallas Fed President Robert Kaplan stated that if the spread of COVID-19’s Delta variant impacted the economic recovery, he might need to change his support.

On Thursday, the Bank of Korea will also announce its newest policy decision. Physical gold demand in top Asian hubs has slowed in the last week. This slowdown was due to rising domestic costs and a seasonal lull.

The SPDR Gold Trust (P: GLD) reported a 0.3 percent drop in holdings to 1,011.61 tons on Friday. Meanwhile, according to the Commodity Futures Trading Commission, speculators boosted their net long positions in COMEX gold while cutting their net long parts in silver in the week ending August 17.

Copper prices advance

Copper prices surged on Monday as risk-on enthusiasm from the stock market spilled over.

Asian shares rose as a wave of bargain-seeking surged through battered markets, and China reported no new COVID-19 cases, indicating that the current outbreak may be winding down shortly. As of 0609 GMT, three-month copper on the London Metal Exchange was up 0.8 percent to $9,106.50 per tonne. The most-traded October copper contract on the Shanghai Futures Exchange was up 1.8 percent to 67,760 yuan ($10,436.01) per tonne.

According to Kingdom Futures director Malcolm Freeman, a more significant gain is boosting metals in US and Asian shares. Still, trade volumes are pretty low across the board, implying that algorithms are at work.