By Adam Claringbull
Investing.com - Gold rose on Tuesday morning in Asia as the dollar dragged down. The precious metal pushed up by 1% after the greenback had its worst day in a fortnight. Trading in Asia pushed gold even higher as the currency differential came into full effect, making gold cheaper for currencies other than the dollar.
Gold futures were up 0.61% to $1,975.75 by 12:30 AM ET (5:30 AM GMT), a 12-day high.
The Dow Jones was up in anticipation of a COVID-19 vaccine, while NASDAQ clawed back a small amount of territory after its recent major falls but was flat at best. Asian markets fell as investors wait on the outcomes of a U.S. Federal Reserve policy meeting, due Thursday, and policy decisions from both the Bank of England and the Bank of Japan, also due on Thursday. Gold gained an advantage from the hiatus, but was mostly driven by a rapidly descending dollar.
Meanwhile, the Senate Banking Committee said on Monday that Fed Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin will testify before the committee on COVID-19 relief.
Brexit continues its uncertain path, with the U.K. Parliament voting for measures likely to breach international law over the Republic of Ireland and Northern Ireland’s shared border. Brent crude remains below $40 per barrel, despite a slight rise as investors wait for the outcome of this week’s OPEC+ meeting, OPEC previously reduced its demand forecasts and warned of continuing oversupply as Libya reopens its oil facilities, factors which are also encouraging for gold’s prospects.
The continued rise in COVID-19 cases and the accompanying reduction in global economic activity remains as a headwind for the precious metal’s value.
Gold, a safe-haven popular during times of social and economic uncertainty, has seen substantial price increases since the onset of the COVID-19 pandemic with prices topping out above $2,072 in August.