Gold came close to one-week high on weak consumer confidence

Gold prices hovered near a one-week high on Monday, as weaker US consumer confidence allayed concerns about the Federal Reserve starting to cut.

Spot gold was flat at $ 1,779.51 an ounce at 01:00 GMT, after peaking since August 6 at $ 1,780.82. US gold futures rose 0.2% to $ 1,781.20.

U.S. consumer confidence fell sharply in early August to its lowest level in a decade, amid growing concerns about the delta variant that could prompt Federal Reserve policymakers to put on hold decisions to withdraw stimulus from the pandemic era.

Gold is seen as a hedge against inflation, likely to result from a general stimulus.

The data weighed on the dollar index, bringing it to a one-week low on Friday, making gold cheaper for holders of other currencies.

On investor radar this week are the minutes from the July Fed meeting on Wednesday and President Jerome Powell’s comments on Tuesday. The geopolitical uncertainties associated with the fall of the Afghan government will also be closely watched.

Physical demand for gold in Asia surged last week as consumers hit good deals after falling prices in all regions, with premiums for major consumers in India and China climbing to highs of several month.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.2% to 1,021.79 tonnes on Friday from 1,023.54 on Thursday.

Speculators cut their net long positions in gold and silver from COMEX during the week ended August 10, according to data from the United States Commodity Futures Trading Commission.

Silver fell 0.2% to $ 23.69 an ounce. Platinum fell 0.7% to $ 1,019.86 and palladium fell 0.4% to $ 2,639.23.