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Gold rises nearly 2% on optimism about ending the US government shutdown
Gold prices rose nearly 2% on Wednesday, November 12, as US Treasury yields fell ahead of a House vote to end the government shutdown, a move that could allow the release of economic data and bolster expectations that the Federal Reserve will cut interest rates in December.
Spot gold rose 1.7% to $4,195.77 an ounce, its highest level since October 21.
US gold futures for December delivery climbed 2.1% to $4,202.20 an ounce.
The yield on the benchmark 10-year US Treasury note fell 1.3% to its lowest level since November 5.
Tim Waterer, chief market analyst at KCM Trade, told Reuters that the weaker dollar was beneficial for gold and silver, which posted gains this week. He added: "Things seem to have returned to normal for gold, as the precious metal has returned to trading above $4,100, and is poised for further gains if US economic data continues to support expectations of further monetary policy easing."
Meanwhile, the dollar index rose 0.1% against a basket of rival currencies, heading towards ending a five-session losing streak, making gold less attractive to holders of other currencies.
The US Senate on Monday approved an agreement to refund federal agencies after the longest government shutdown in the country's history, which disrupted food assistance for millions of Americans, left hundreds of thousands of federal employees without pay, crippled air travel, and delayed the release of government economic data.
