Gold price pushed above $1,900 an ounce to hit the highest level in almost two months, aided by a weaker dollar, after posting the biggest annual advance in a decade. Silver price also surged on the first full trading day of the new year.
Bullion is rallying as a gauge of the U.S. currency languishes near the lowest level since 2018. The gains in the traditional haven come even as U.S. and global stocks are at all-time highs amid expectations that widespread vaccine distribution in 2021, further central bank support, and government aid will reignite economic growth and underpin corporate profits.
Spot gold climbed as much as 1% to $1,917.05 an ounce, the highest since Nov. 9, and traded at $1,916.53 at 9:10 a.m. in Singapore as the Bloomberg Dollar Spot Index fell 0.1%. In 2020, the precious metal rose 25%. Silver advanced as much as 2.8%, and platinum hit $1,085.31 an ounce, the highest since September 2016.
Gold’s recent gains have also been aided by renewed declines in U.S. real yields, which boost the precious metal’s allure. Real yields — the difference between nominal benchmark bond yields and the rate of inflation — were at -1.092% on Friday. That’s near last year’s nadir.
On the coronavirus front, U.S. daily cases soared to a record of nearly 300,000 after the holidays, while global cases hit 85 million. The U.S. vaccine rollout is picking up speed and could be fully on track within a week or so, said Anthony Fauci, the nation’s top infectious disease expert. U.K. Prime Minister Boris Johnson said tougher lockdown measures in England, including school closures, will probably be needed as cases of a new virus variant surge.
