July 31, 2020 / 3:43 AM / 6 days ago

PRECIOUS-Gold eyes best month since Jan. 2012 as weak U.S. data dents dollar

    * Silver on track for best month on record
    * Dollar hits over two-year low, eyes worst month in decade
    * Interactive graphic tracking global spread of coronavirus:
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tmsnrt.rs/3aIRuz7 in an external browser

 (Updates prices)
    By Brijesh Patel
    July 31 (Reuters) - Gold rose on Friday en route to its best
month in 8-1/2 years as the dollar slid further after dismal
U.S. data added to doubts about a swift recovery from the
pandemic-induced economic slump, driving investors towards the
safe-haven metal.
    Spot gold        was up 0.8% at $1,975.44 per ounce by 0651
GMT after snapping a nine-session winning streak on Thursday.
U.S. gold futures         rose 1.5% to $1,970.70.
    The U.S. dollar        fell to a two-year low and was on
course for its worst month in a decade, making bullion cheaper
for investors holding other currencies.       
    Apart from U.S. data showing the deepest economic
contraction in at least 73 years in the second quarter, and a
rise in unemployment benefits, the dollar was also hurt as
President Donald Trump raised the idea of delaying the Nov. 3
presidential election.                           
    "The weak Q2 GDP also underscores the point of a weak
economy, and investors seeking refuge in gold," said National
Australia Bank economist John Sharma.
    A deterioration in the coronavirus situation, escalation in
geopolitical tensions and further declines in the dollar could
push gold above the $2,000 level, he added.
    Gold has risen nearly 11% so far this month, its biggest
monthly percentage gain since January 2012, having soared to an
all-time high of $1,980.57 on Tuesday.
    The jump took gains for the year to nearly 30%, driven by a
worsening pandemic and low interest rates globally amid
widespread stimulus from central banks since the metal is
considered a refuge against inflation and currency debasement.
    "However, further gains are reliant on investor demand, with
consumer demand showing no signs of recovery," ANZ analysts said
in a note.         
    Among other metals, silver        climbed 2.6% to $24.16 an
ounce, on course for its best month on record - up over 30%,
with additional support coming from hopes for a revival in
industrial activity.                          
    Platinum        rose 0.8% to $909.98 and palladium       
gained 0.7% to $2,096.84.

 (Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu
Sahu)
  
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