Gold hits near 7-week high as dollar, stocks slip

bengaluru — Gold touched its highest in near seven weeks on Tuesday as Asian stock markets and the dollar weakened ahead of a UK national election and a European Central Bank meeting due later this week.

James Comey, former head of the US Federal Bureau of Investigation, is due to appear before a Senate committee for the first time on Thursday. Comey was fired by President Donald Trump in May while leading a probe into alleged Russian meddling in last year’s US election. The events all have the potential to boost the safe-haven appeal of bullion.

“Much will, of course, depend on the US dollar. However, with event risk in the form of this Thursday’s ECB rate decision and the UK general election, one would expect the safe haven bid to be alive and well as the week progresses,” said Jeffrey Halley, a senior market analyst at Oanda.

Spot gold rose 0.8 per cent to $1,289.20 per ounce, as of 0805 GMT. Earlier in the session, it hit a peak of $1,289.67 an ounce, its highest level since April 19.

US gold futures climbed 0.7 per cent to $1,291.8 an ounce.

“Generally light positioning and numerous upcoming geopolitical events should continue to underpin demand for the metal, with targets extending to the 2017 high around $1,295 and the psychological level of $1,300 above this,” Sam Laughlin, senior precious metals trader at MKS, said in a note.

In Britain, Prime Minister Theresa May’s lead over the opposition Labour Party has narrowed to just one percentage point, according to a poll by Survation for ITV television on Monday.