Gold steadies above $1,900 on weaker dollar
Gold prices rose nearly 1 percent, drifting further away from a 3-week low on a weaker dollar and concerns over global economic fallout from mounting COVID-19 cases.
Spot gold was trading 0.8 percent higher at $1,932.55 per ounce by 0931 GMT, having hit a low of $1862.89 on Wednesday, its lowest since July 22. U.S. gold futures eased 0.4 percent to $1,941.20.
The dollar index slumped from recent peaks against its rivals, amid fading hopes for a compromise between Republicans and Democrats over additional stimulus for the U.S. economy.
President Donald Trump accused congressional Democrats of not wanting to negotiate over a U.S. coronavirus aid package, while U.S. Treasury Secretary Steven Mnuchin stated that White House and top Democrats in Congress may not be able to reach a deal on coronavirus aid, with the stalemate blocking relief to tens of millions of Americans.
The bid tone around the greenback further weakened after three Federal Reserve policymakers warned U.S. economic recovery will be slow until the virus was contained and Americans will have to manage life with the virus for at least the next several months.
According to a Reuters tally, more than 20.45 million people have been reported to be infected by the coronavirus globally and 743,229 have died.
The number of daily new COVID-19 infections in the United States seems to be stabilising around 55,000, while an unexpected rise in consumer prices last month has seemed to reinforce confidence in recovery. U.S. consumer prices rose more than expected in July, with a measure of underlying inflation increasing by the most in 29-1/2 years amid broad gains in the costs of goods and services.
The greenback against a basket of currencies traded 0.4 percent down at 93.10, having touched a high of 93.91 on Wednesday, its highest since August 4. The U.S. Treasury yields declined, with the benchmark 10-year note yield trading at 0.667 percent, off 1-month high.
Investors now await breakthrough in stalled U.S. stimulus talks, while keeping a close watch on frayed U.S.-China ties ahead of key trade talks scheduled on Aug. 15. Markets also eye U.S. weekly jobless claims data due later in the day, which is expect to show a modest downtrend to continue.