Gold steadies off multi-month peak on weaker dollar, bitcoin selloff – Up News Info

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Gold steadied on Monday, consolidating

near a 4-1/2-month peak, buoyed by a subdued dollar and a

selloff in cryptocurrencies, while investors awaited key

economic data releases this week.

Spot gold was little changed at $1,881.40 per ounce

by 1021 GMT. Last week, gold prices hit their highest level

since Jan. 8 at $1,889.75. U.S. gold futures rose 0.3% to

$1,882.10.

Following volatility last week in the wake of China’s clamp

down on commodity prices and U.S. Federal Reserve meeting

minutes, gold has moved above its 200-day moving average,

supported by a weaker dollar and bond yields and questions about

inflation, said independent analyst Robin Bhar.

Gold is considered a hedge against inflation.

Also supporting gold, Bitcoin fell 13% on Sunday,

leaving it around 50% below this year’s high after Beijing

stepped up efforts to crack down on bitcoin mining and trading.

“The recent slide in cryptocurrencies also boosted the

appeal of gold as an alternative investment asset. Gold’s upward

momentum is very strong and it is likely to challenge a key

psychological level at $1,900 in the days to come,” said

Margaret Yang, a strategist at DailyFX.

Meanwhile, the dollar index was pinned near three-month

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lows, making gold more attractive for those holding other

currencies.

Rising U.S. inflationary risks have spooked markets, and

minutes from the Fed’s most recent meeting suggested some

policymakers were ready to talk about reducing stimulus by

tapering bond purchases.

Markets will be keen to hear if the crowd of Fed speakers

this week will stick to the script on being patient with policy.

A slew of economic data including GDP, jobless claims and

durable goods are also scheduled for release.

Gold’s move into ‘overbought’ technical territory, given

seven straight days of gains, could signal a correction, said

StoneX analyst Rhona O’Connell.

Elsewhere, palladium rose 0.2% to $2,787.62 per

ounce, silver gained 0.6% to $27.68, and platinum

was little changed at $1,166.96.

(Reporting by Brijesh Patel and Arundhati Sarkar in Bengaluru,

Editing by Sherry Jacob-Phillips, Kirsten Donovan)