Gold firms as softer dollar, economic woes boost safe-haven appeal

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Gold prices edged higher on Thursday, aided by a weaker dollar and economic worries, while investors sought further clarity on the U.S. Federal Reserve’s monetary policy path.

Spot gold was up 0.2% at $2,032.74 per ounce, as of 0327 GMT. U.S. gold futures were up 0.1% at $2,038.90.

 

The dollar index dipped for a second straight day, making the greenback-priced bullion more affordable for overseas buyers.

“While gold remains supported overall, it doesn’t look overly happy at these highs and investors seem quick to book profits with any break above $2,050 for now,” said Matt Simpson, senior market analyst at City Index.

Bullion prices initially rose on Wednesday after U.S. inflation data was released, before turning negative on profit taking.

The annual increase in U.S. consumer prices slowed to below 5% in April for the first time in two years, potentially providing cover for the U.S central bank to pause interest rate hike next month.