Gold Rises as The Dollar Falls After Trump Threatens Not to Sign The Stimulus

Gold prices rose slightly on Wednesday, December 23, after US President Donald Trump threatened not to sign the pandemic relief bill, sparking a drop in the dollar.

The spot price of gold was up 0.1% to $ 1860.81 an ounce, while US gold futures fell 0.3% to $ 1864.60 an ounce.

The metal has risen about 23% since the beginning of the year and is heading to achieve its biggest annual gain since 2010, with central banks and governments around the world embarking on unprecedented stimulus measures to ease the economic repercussions of the Coronavirus crisis.

Gold is used as a hedge against inflation, which is caused by increased cash flows to the economy, and benefits from low interest rates that reduce its opportunity cost.

The dollar index fell 0.2% against major rival currencies after Trump threatened not to sign the recovery bill, increasing the temptation for gold to non-US investors.

Silver rose 0.8% to $ 25.31 an ounce. Platinum rose 0.5% to $1007.39, and palladium rose 0.4% to $2,322.52 an ounce.