By David Brough
Gold, which hit a more than seven-month low last week, risks further falls in the near term depending on the U.S. dollar and Treasury yields.
Gold was up 0.66 percent to $1,784.40 per ounce.
Expectations of a swift vaccines rollout are raising hopes for global economic recovery, reducing the “safe-haven” appeal of gold.
Gold is also competing with cryptocurrency bitcoin, and possibly silver, which has a constructive story due to tightness in supplies of newly mined metal and expectations of strong industrial demand.
Rising US Treasury yields have weighed on prices of non-yielding gold lately.
A strengthening dollar could drag on bullion, as it would make gold costlier in terms of other currencies.
However, gold is likely to remain underpinned by a US $1.9 trillion stimulus package that is expected to relieve the devastation of the coronavirus pandemic on American livelihoods.
The stimulus package may raise inflationary fears, which could buoy bullion seen as a hedge against rising prices.
Disclaimer: Any opinions expressed in this column are solely those of the author and should not be considered as investment advice.