Gold prices halt 3-session slide as U.S. dollar stumbles

Gold prices halt 3-session slide as U.S. dollar stumbles

Gold futures ended higher Wednesday, with the precious metal halting a three day decline, as the U.S. dollar softened.

A series of U.S. economic reports, published early due to the holiday-shortened week, saw bullion enjoy a pop higher as the U.S. dollar retreated, as measured by the ICE U.S. Dollar Index DXY, -0.26% which was off 0.3%.

Consumer spending, the backbone of the U.S. economy, declined in November as COVID-19 cases picked up across the country and damped activity.

New applications for U.S. unemployment benefits fell to a three-week low of 803,000 right before Christmas, but the relatively high level still reflected a fresh wave of layoffs tied to the record COVID-19 outbreak.

Bullion enthusiasts see the precious asset as a potential hedge heading into 2021, with fears of aggressive government spending, ultralow bond yields, and lofty stock valuations buttressing the commodity.

“Overall, we remain positive on the yellow metal as long as real yields continue trading in negative territory, which is likely to be the scenario in the year ahead,” wrote Hussein Sayed, chief market strategist at FXTM, in a note.

February gold GCG21, 0.20% traded $7.80, or 0.4%, higher to close at $1,878.10 an ounce, after a 0.6% slide on Tuesday. If the metal had closed lower on Wednesday it would have represented its longest bout of weakness since the period ended April 20.

Silver for March delivery SIH21, 0.21%, meanwhile, rose 38.6 cents, or 1.5%, to settle at $25.921 an ounce, following its 3.2% decline in the previous session.

In other metals, March copper HGH21, 0.01% gained 3.6 cents, or 1%, to close at $3.556 a pound, after a 1.6% decline Tuesday.

January platinum PLF21, 0.79% added $7.70, or 0.8%, to settle at $1017.10 an ounce, after declining 0.7% a session ago, while March palladium PAH21, -0.05% picked up $16, to finish at $2,339.10, to finish at $2,323.10 an ounce, following a 0.3% gain on Tuesday.

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