Gold prices extend climb to highest level since February as dollar sinks to 2 1/2-month low

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Gold prices added to gains Monday, supported by a weakening of the U.S. dollar to around a 2 1/2-month low.

June gold
GCM21,
+0.56%
 was up $9, or 0.5%, to trade at $1,840.30 an ounce, after the most-active contract logged a 3.6% weekly gain and marked the highest finish since Feb. 10, FactSet data show.

“The near-term technical postures for both metals are also bullish, which continues to invite the shorter-term futures traders on board the long sides of those markets,” wrote Jim Wyckoff, senior analyst at Kitco.com.

“The metals are supported by a slumping U.S. dollar index that hit a 2.5-month low overnight,” he wrote.

The U.S. dollar was trading down 0.2% at 90.08, as measured by the ICE U.S. Dollar Index
DXY,
-0.07%,
which is around the lowest level for the index since late February.

A weaker dollar can help to support buying in commodities priced in the currency for overseas investors.

On Friday, gold booked the highest finish in almost three months after the U.S. Labor Department reported that the economy gained 266,000 jobs in April, far fewer than even the most subdued forecast for the month, raising some questions about the strength and pace of the recovery from the COVID pandemic.

There was no data on Monday and investors are watching for a reading on retail sales on Wednesday.



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