Gold steady as U.S. political woes keep dollar in check

Gold prices were steady after hitting a four-week high on Monday, supported by political uncertainty in the United States and as the dollar remained near its lowest in 13 months.

Doubts over the passage of U.S. President Donald Trump`s stimulus and tax reform agendas continued to weigh on the dollar, although it rose a touch on Monday. [USD/]

A weaker greenback makes dollar-denominated gold less expensive for holders of other currencies, while the metal is also used as an alternative investment during times of political and financial uncertainty.

"I think people are getting more nervous and careful about what is going to happen (in terms of the controversies surrounding the administration of U.S. President Donald Trump)," said Yuichi Ikemizu, Tokyo branch manager at ICBC Standard Bank.

"The market is expected to be quiet heading into the summer holidays in Asia, but if it moves at all, it`ll move to the upside rather than the downside."

Meanwhile, the U.S. Federal Reserve`s rate-setting committee is due to meet on July 25 and 26.

Spot gold remained unchanged at $1,254.11 per ounce at 0744. It earlier hit a 4-week high of $1,257.18 an ounce, having risen 2.1 percent last week.

U.S. gold futures for August delivery were also nearly flat at $1,254.30 per ounce.

"We would expect that gold will continue to find friends on dips now as we head into a packed Central Bank and data week," said Jeffrey Halley, a senior market analyst at OANDA.

Spot gold may peak around resistance at $1,261 per ounce, as suggested by a Fibonacci retracement analysis, a rising channel, and the hourly relative strength index, according to Reuters technical analyst Wang Tao.

Hedge funds and money managers increased their net long position in COMEX gold for the first time in six weeks in the week to July 18, U.S. Commodity Futures Trading Commission data showed on Friday.

Elsewhere, gold demand in Asia eroded last week due to higher prices, with a seasonal slowdown denting the lure for the precious metal in second-biggest consumer India.

In other precious metals, silver prices remained unchanged at $16.47 per ounce, after earlier hitting their highest since July 3 at $16.53. The metal rose 3.26 percent last week, its biggest weekly gain since early January.

Platinum dropped 0.4 percent, to $929.65 per ounce. It climbed nearly 2 percent last week in its largest weekly gain since mid-May.

Palladium eased 0.4 percent to $842.00 per ounce, after falling 1.5 percent last week.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)