Gold prices hit near 2-mth high on soft dollar; US inflation, labor data awaited

Gold prices rose in Asian trade on Monday, extending gains after hitting a near two-month high in the prior session as weakness in the dollar and Treasury yields, following less hawkish signals from the Federal Reserve, buoyed metal markets.

Silver prices remained close to record highs after stellar gains last week, while broader metal prices also advanced.

Focus this week is squarely on two key U.S. economic indicators– nonfarm payrolls and consumer price index inflation– which are likely to factor into the Fed’s outlook on interest rates.

Spot gold rose 1% to $4,343.62 an ounce, while gold futures for March rose 1.1% to $4,375.80/oz by 01:00 ET (06:00 GMT).

Spot silver rose 1.6% to $62.9865/oz, remaining close to a record high hit last week. Spot platinum rose 1.8% to $1,781.09/oz.

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Gold, metals extend gains after dovish Fed signals hit dollar, yields
Gold and other metals largely extended gains from last week, as the sector was boosted by weakness in the dollar and Treasury yields.

This came largely following dovish signals from the Fed, after it cut interest rates last week and signaled it will immediately begin buying short-dated Treasuries from December, at a monthly pace of $40 billion.

The Fed’s asset buying activities present a dovish outlook for monetary policy, especially given that local liquidity conditions are likely to loosen further with the cash injections.