Gold settles near a 5-month peak with decline of dollar and China easing Corona restrictions

Gold prices stabilized Monday, December 5, after hitting their highest level in 5 months, while the dollar fell after more Chinese cities eased anti-Covid-19 restrictions over the weekend.

There was little change in the spot gold price, recording $1,799.26 an ounce, after touching the highest level since July 5 at $1,809.91. US gold futures rose 0.1% to $1,812.10.

The dollar index settled near its lowest level in more than 5 months, making gold priced in the US currency less expensive for buyers holding other currencies.

The US labor market shrugged off fears of a recession, with data released on Friday showing US employers hired more employees than expected in November and raised wages.

Traders see a 91% chance of a 50 basis point rate hike at the Fed meeting this month.

Low interest rates tend to support gold as it reduces the cost of hedging the non-yielding precious metal.

And more cities in China, the largest gold consumer, announced on Sunday the easing of anti-Corona virus restrictions, as the country seeks to make its “zero Covid” policy more targeted and less stressful after unprecedented protests.

As for other precious metals, silver rose in spot transactions by 0.1% to $23.14 an ounce, platinum rose 0.2% to $1016.01, and palladium rose 0.8% to $1914.02.