Gold rose to a 7-week high on Thursday on a weaker dollar after U.S. President-elect Donald Trump provided little clarity on future fiscal policies at a press briefing.
Spot gold was up 0.5 percent at $1,196.06 per ounce, after touching a high of $1,198.58, its best since November 23.
U.S. gold futures rose 0.1 percent to $1,197.80 per ounce.
In his first press briefing as U.S. president-elect, Trump presided over a wide-ranging session that lasted longer than expected but contained no details on tax cuts and infrastructure spending, analysts said.
“Politics appears to have captured the gold market’s attention and is playing a role in directing near-term prices,” HSBC analyst James Steel said in a note.
“Gold will remain finely tuned to political comments and developments from Trump and his team … if the economic nationalists, who want to impose tariffs and increase infrastructure spending, have greater influence, we believe gold will likely trade higher.”
The $1,200 level will offer stiff resistance and gold may not be able to break it easily, Steel added.
Trump’s campaign calls for tax cuts and more infrastructure spending have boosted U.S. shares and the dollar, as well as driving a selloff in Treasuries, but his protectionist statements and a flurry of off-the-cuff Tweets have kept many investors from adding to risky positions.
“There is some kind of uncertainty in Trump’s policies and the dollar’s upside is also being questioned by the markets,” Argonaut Securities analyst Helen Lau said.
“We need more positive developments in U.S. economic fundamentals before the dollar can go higher,” Lau said, adding that markets were disappointed in Trump’s speech.
The dollar index, which tracks the U.S. currency against a basket of six major counterparts, was down 0.3 percent at 101.470, having hit a one-week high on Wednesday.
“The dollar will roll back a good proportion of its gains over the course of the month in January and gold should benefit as a result if Trump team hits the ground running and continues to give more impressions of disarray than what has been apparent so far,” INTLFC Stone analyst Edward Meir said in a note.
The outlook for U.S. rates may become a little clearer when Federal Reserve Chair Janet Yellen appears at a webcast town hall meeting with educators on Thursday.
A host of Federal Reserve presidents including Philadelphia, Chicago, Atlanta, Dallas and St. Louis will also speak on a range of issues.
Spot silver rose 0.5 percent to $16.81 an ounce. Platinum was up 0.7 percent to $979, after touching a high of $986.10, its best since November 10. Palladium was slightly firmer at $754.50.
Source: Reuters
