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Gold price rises ahead of first presidential debate

Image courtesy of the Trump Statue Initiative.

Gold prices erased earlier losses and edged higher on Monday as the dollar retreated from a two-month peak ahead of the US presidential debate this week. However, a rebound in the equities market capped bullion’s gains during the session.

Spot gold rose 0.6% to $1,872.30 per ounce by noon EDT, after falling to as low as $1,850.20 per ounce earlier. US gold futures were also up 0.5% to $1,875.60 per ounce in New York.

Meanwhile, the dollar index eased 0.4% from a near two-month peak that it hit during the previous session as the market gears up for the first presidential debate between incumbent Donald Trump and Democratic nominee Joe Biden, which is set to take place on Tuesday.

“Gold has started to recuperate losses as the dollar has eased and real rates have edged lower,” Standard Chartered analyst Suki Cooper told Reuters.

“There are plenty of risk events this week for gold to take its cue from, ranging from the first of three US presidential debates to unemployment and inflation data,” she added.

Key support

According to Edward Moya, senior market analyst at OANDA in New York, gold has found a “new key technical support level” at $1,850 per ounce.

“The fact that gold is down over a couple of hundred dollars from its record highs, investors see this as a good opportunity to get in,” Moya said.

Despite the gains on Monday, gold is still down about 10% from a record peak of $2,072.50 from August. On Friday, the precious metal posted its biggest weekly decline since March.

(With files from Reuters)