Gold prices climbed this morning as the U.S. dollar weakened and concerns over Omicron led bullion’s year-end rally to a more than one-month high.
Spot gold rose 0.3 per cent to $1,815.39 an ounce this morning, hitting its highest since the end of November at $1,816, while U.S. gold futures rose 0.4 per cent to $1,816.60.
“While there are concerns over the Omicron variant, the investment demand is quite flat. So it is just the year-end rally since there is still some risk-on sentiment present,” Jigar Trivedi, a commodities analyst at Mumbai-based broker Anand Rathi Shares, told Reuters.
“Gold may not rally too much in the absence of any major economic data and it will remain in this range,” Trivedi said, adding that the positive sentiment on gold at the moment is a result of a weaker dollar.
The U.S. dollar slipped and was near the bottom end of its recent trading range against a basket of peers, supporting gold’s appeal for holders of non-U.S. currencies.
Limiting gains in safe-haven bullion, shares in Europe and Asia edged higher, helped by another record-setting day on Wall Street.
The underlying support for gold comes from mounting inflation concerns as the pandemic continues to sweep across the world as we head into 2022.