01.09.202011:04:00UTC+00Gold Hovers Near Two-week High As Dollar Weakens

Gold prices rose about 1 percent to hover near a two-week high on Tuesday as the dollar extended losses to the lowest level since May 2018, making commodities priced in the currency more appealing.

Spot gold climbed 1.1 percent to $1,989.68 per ounce, while U.S. gold futures were up 1 percent at $1,997.75.

The dollar sank to more than two-year lows, hit by fears about the pace of economic recovery, uncertainty ahead of the U.S. presidential election in November and speculation that the Federal Reserve will keep interest rates very low for years.

A lower U.S. currency makes dollar-denominated commodities cheaper for consumers in other currencies.

The U.S. Federal Reserve said last week it was willing to let inflation surpass the 2 percent threshold for some time as it worked to revamp the economy.

Gold has gained about 31 percent this year amid uncertainty over economic recovery stemming from the coronavirus pandemic.

Global Covid-19 infections have passed 25.5 million with more than 850,000 deaths, according to Johns Hopkins University.