Gold In Asia Increases Above 1.900 Dollars After US Inflation Lifts Interests
JAKARTA - Gold prices held above the psychological 1.900 dollar level in Asian trade early Monday, extending last week's gains after US consumer prices for April rose more than expected, supporting gold's appeal as a hedge against inflation.
Between Monday, May 31, in the spot market, gold was steady to trade at USD 1.903.25 per ounce at 0036 GMT. Meanwhile, US gold futures edged up 0.1 percent to trade at USD 1.907 dollars an ounce.
Late last week, the most active gold contract for August delivery on the Comex division of the New York Exchange, was up 6.8 dollars, or 0.36 percent to close at USD 1.905.30 per ounce.
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US consumer prices surged in April, with the underlying inflation gauge topping the Federal Reserve's 2.0 percent target and posting its biggest annual gain since 1992, lending support to gold.
Meanwhile, the 10-year US Treasury yield fell to 1.593 percent, reducing the chances of a loss holding interest-free gold.
The White House on Friday, May 28 sent Congress a USD 6.0 trillion budget plan that will increase spending on infrastructure, education, and fighting climate change.
On the other hand, Asian stocks were modestly higher in early Monday morning trade, which could extend the recent rally into a third week if US jobs figures show an expected revival in hiring for May and keep the global recovery on track.
Demand for physical gold in India's second-largest gold consumer was last week ignored, with most jewelry stores still closed by the COVID-19 shut down, forcing the dealers to offer at a great discount.