BENGALURU, Nov 16 (Reuters): Gold hit a one-week high on Monday as COVID-19 cases continued to mount, raising investor expectations of further economic stimulus measures, while a subdued dollar added support.
Spot gold was up 0.3 per cent to $1,893.30 per ounce at 1024 GMT, having earlier hit its highest since Nov. 9 at $1,898.81.
US gold futures were up 0.3 per cent at $1,891.70.
Apart from a weaker dollar, gold is finding support from "the continued rally in rising COVID-19 cases, especially in the US, (which) raises prospects for additional stimulus," said Saxo Bank analyst Ole Hansen.
Coronavirus cases crossed the 11-million mark in the United States on Sunday.
The dollar index touched a one-week trough, making gold cheaper for investors using other currencies.
Gold's gains also came alongside a jump in European equities, which were boosted by strong Chinese factory output data and optimism surrounding a COVID-19 vaccine.
US drugmaker Moderna said it had enough data for a first interim analysis of its late-stage COVID-19 vaccine trial.
The China data may translate into additional gold physical demand, but the impact of the news from Moderna may be limited, Saxo Bank's Hansen said. With little prospect of a return to normality until the second half of 2021, that "still leaves a massive gap in some of the economies globally that needs to be filled by governments and central banks," he said.
Gold, which benefits from stimulus measures since it's considered a hedge against inflation and currency debasement, has gained over 24 per cent this year.
But renewed vaccine optimism, rising bond yields and a rebound in dollar may limit gold's "upside potential," said Lukman Otunuga, Senior Research Analyst at FXTM.
Investors are also awaiting economic cues from speeches by US Federal Reserve policymakers this week, beginning with Vice Chair Richard Clarida at 1900 GMT.
Silver rose 1.0 per cent to $24.87 per ounce. Platinum gained 1.6 per cent to $903.15, while palladium was 0.6 per cent higher at $2,336.72.
