Gold inches lower as investors await US election outcome

Gold costs edged down on Tuesday, as cautious traders awaited the result of the US presidential election with President Donald Trump carefully trailing Democrat Joe Biden in nationwide opinion polls.

Spot gold had been down 0.1% at $1,892.52 per ounce by 0353 GMT.

US gold futures had been little modified at $1,892.00 per ounce.

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“Sentiment is hanging by a thread at the moment… Everybody is quite unsure where the election is headed to, given the number of possible outcomes,” mentioned Howie Lee, economist at OCBC Bank.

As lengthy as there isn’t a Democrat sweep, there will probably be questions on fiscal stimulus, whereas an unsure or contested outcome will probably favour the greenback and weaken gold, he added.

Election polls present Biden with an outright majority nationally however the race between each him and Republican candidate Trump stays nearer in a number of battleground states.

Analysts say a Biden win may assist the bullion rally along with his plans to inject a probably massive stimulus help.

The indisputable fact that there isn’t a brand new fiscal stimulus is holding gold again and it could not occur if Trump will get re-elected as a result of it’ll take time to barter with the Democrats and it’ll simply be drawn out, mentioned ED&F Man Capital Markets analyst Edward Meir.

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Gold, which is seen as a hedge in opposition to inflation and foreign money debasement, has gained over 24% up to now this 12 months on unprecedented stimulus measures.

Meanwhile, two main state-owned Chinese banks warned on Monday that they might limit buying and selling of treasured metals and overseas trade merchandise if the US election fuels market volatility.

Also on investor’s minds, the Federal Open Market Committee (FOMC) will start its two-day assembly on Wednesday, with policymakers anticipated to maintain rates of interest unchanged.

Silver had been little modified at $24.03 per ounce. Platinum fell 0.2%, to $856.71 and palladium gained 0.9% to $2,231.90.