The price of gold broke above the key $1,800 mark on Tuesday as the dollar weakened following China’s decision to ease COVID restrictions.
As of 0955 GMT, spot gold was up 0.6% at $1,808.89 an ounce, and US gold futures were up 0.8% at $1,817.60.
Gold is behaving in line with risk assets and “new signs that the dollar king is loosening his grip on the haven throne is also encouraging bullion bulls to restore spot prices back above the psychological mark of $1,800,” said Han Tan, chief market analyst at Exinity.
The dollar index fell 0.3% against its rivals as risk sentiment improved after learning of the easing of Chinese quarantine rules. The US currency and gold compete as rival safe-haven assets.
The gold metal has gained close to $200 after falling to more than two-year lows in late September, as expectations of a slowdown in interest rate hikes by the US Federal Reserve dim the note’s appeal. green.
“Gold was weaker for most of 2022 amid aggressive monetary policy tightening, rising real yields and a stronger dollar. But the tide has turned as the Fed shifts into calibration mode of policies,” said Christopher Wong of OCBC FX. “A sustained recovery in gold prices is possible if the Fed pivots.”
Beijing announced on Monday that travelers arriving in the country will no longer have to quarantine from January 8, a rule that will make returning home much easier.
In other precious metals, spot silver was up 2.1% at $24.22 an ounce; platinum added 0.8% to $1,029.63; and palladium was up 1.2% at $1,785.63.
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