Gold jumps 2 pct as dollar falls from multi-month highs
* Gold jumps after three sessions of losses
* Dollar retreats from 16-month highs, down 0.9 pct
* Platinum hits highest since June 27
(Recasts, adds comments, updates prices)
By Karthika Suresh Namboothiri and Sethuraman N R
BENGALURU, Nov 1 (Reuters) - Gold rose nearly 2 percent on
Thursday, bouncing off a three-week low touched in the previous
session as the dollar fell sharply from recent highs, making the
metal cheaper for holders of other currencies.
Spot gold gained 1.7 percent at $1,234.18 per ounce
by 14:02 p.m EDT (1802 GMT) after rising as much as 1.9 percent
to its highest since Oct. 26 at $1,237.39. U.S. gold futures
settled up $23.60, or 1.94 percent, at $1,238.60.
"The pretty aggressive drop in the U.S. dollar was a
significant catalyst for gold today," said Bart Melek, head of
commodity strategies at TD Securities.
"The drop in the U.S. bond yields, dollar and improvement in
Chinese yuan were major factors and we continue to have
volatility in the equity markets. With all of that we have seen
significant short covering in gold."
The dollar index, which measures the U.S. unit
against a basket of six major currencies, fell 0.9 percent,
dropping from a 16-month high hit in the previous session on
continued U.S. economic strength.
Federal data on Thursday showed new applications for U.S.
unemployment aid fell last week and the number of Americans
receiving benefits was the lowest in more than 45 years as labor
market conditions tightened further.
The economy's upbeat outlook was, however, tempered by news
that manufacturing activity slowed in October as a measure of
new orders dropped to its lowest level in 1-1/2 years.
Investors will focus on Friday's non-farm payrolls data for
further clues on the strength of the U.S. economy.
Markets are also watching the U.S. congressional elections
on Tuesday, which will determine whether the Republican or
Democratic party controls the U.S. Congress, with some
predicting increased market volatility on the outcome.
Gold fell in the three previous sessions and touched its
lowest since Oct. 11 on Wednesday at $1,211.52 per ounce.
"Traders stepped in to buy the dip in gold prices on some
perceived bargain-hunting and by some short-covering from the
futures traders," Kitco Metals senior analyst Jim Wyckoff said
in a note.
"Precious metals are seeing buying interest as the U.S.
dollar index is posting sharp losses today."
Among other precious metals, platinum climbed 2.8
percent to $859.40 per ounce, having touched its highest since
June 27 at $860.90 earlier in the session.
Silver jumped 3.7 percent to $14.74 per ounce, while
palladium rose 1.2 percent to $1,091.45.
(Reporting by Swati Verma, Sumita Layek and Karthika Suresh
Namboothiri in Bengaluru; Editing by Dan Grebler and Cynthia
First Published: 2018-11-01 16:30:29
Updated 2018-11-01 20:20:22
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