Gold prices firmed on Monday as investors cheered news that a U.S. fiscal stimulus deal was likely to be passed, although gains were capped by a stronger dollar.
Spot gold rose 0.4% to $1,888.76 per ounce by 0048 GMT. U.S. gold futures firmed 0.2% to $1,892.80.
U.S. congressional leaders have reached agreement on a $900 billion package to provide the first new aid in months to the coronavirus-hit economy, the Senate’s top Republican and Democrat said on Sunday, with votes likely on Monday.
Meanwhile, Covid-19 infections continued to soar globally as South Korea and London reported record new coronavirus cases on Sunday, with Britain’s health minister suggesting tighter curbs could stay for some time.
The U.S. dollar rose 0.2% against its major peers, reducing bullion’s appeal to holders of other currencies.
Hedge funds and money managers raised their bullish positions in COMEX gold and silver contracts in the week to Dec. 15, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
Silver rose 0.9% to $26.01 per ounce. Platinum was up 0.1% at $1,036.75 and palladium fell 0.1% to $2,358.71.