PRECIOUS METALS | Gold Rallies More Than 2% as Democratic Wins Weaken Dollar

According to Jin10, spot gold rose more than 2% on Wednesday after Democrats won key races in the U.S. midterm elections, weakening the dollar and supporting gold prices. Investors were also awaiting U.S. nonfarm payroll data due later this week for clues about the Federal Reserve’s future policy path. Pepperstone Head of Research Chris Weston said that a weaker dollar and sharp declines in both nominal and real U.S. Treasury yields supported gold. He said investors wanted to hedge against the risk that the Trump administration could become less predictable and more confrontational, and that safe-haven demand appeared to create a favorable market environment for gold buyers. Democrats scored a decisive victory in the midterm elections, while global stocks fell and the dollar weakened. The weaker dollar made gold priced in dollars cheaper for overseas buyers.