Gold prices were rising for a fourth straight session on Friday, putting bullion on track to notch the longest win streak since early August, and helping the commodity notch its first weekly gain in the past month.
The yellow metal’s rise has come after it touched a roughly five-month low to start the week, with that decline precipitated by growing hope around COVID-19 vaccine progress.
However, a steady bout of weakness in the U.S. dollar has emboldened gold bulls, as has the prospect of a fresh round of fiscal aid in the U.S. to combat the economic damage from the viral outbreak—both seen as bolstering appetite for gold and other precious metals.
Senate Majority Leader Mitch McConnell, R-Ky., said Thursday that reaching a compromise on another coronavirus fiscal stimulus package was possible, as long as Democrats moved toward Republican positions.
Gold, against that backdrop, has surged 3.2% so far this week as the dollar, as measured by the ICE U.S. Dollar Index
DXY,
,
has fallen 1.3% to around its lowest level since 2018.
Read: Why a weak dollar and a strong stock market are likely to keep going hand in hand
“The sell-off seen on the US Dollar is boosting gold recovery,” wrote Carlo Alberto De Casa, chief analyst at ActivTrades, in a daily note.
The analyst said that although news of cures for the deadly disease are bearish for gold, the development of remedies won’t entirely undercut the bullish thesis for the precious metal, which also has been rising on high government spending across the globe.
“Now, investors are realizing, once again, that gold will remain crucial in the medium and long term, as central banks will be forced to continue to print money to sustain economies,” De Casa wrote.
The ActivTrades analyst said gold may meet some resistance at $1,850, which had stood as previous support for the metal before its breakdown late last month.
Investors will be keep a keen eye on economic reports in the U.S., with the November employment report, due at 8:30 a.m. Eastern. Economists surveyed by MarketWatch forecast a 438,000 increase in new jobs for last month.
At last check, February gold
GCG21,
was up $5.70, or 0.3%, at $1,846.80 an ounce, after gaining 0.7% on Thursday to mark the highest finish for a most-active contract since Nov. 20, according to FactSet data. The metal is on pace for a fourth straight gain, which would represent its longest win streak since Aug. 6.
Meanwhile, March silver
SIH21,
added 28 cents, or 1.2%, to trade at $24.41 an ounce after rising 0.2% in the prior session.
For the week, gold is on pace for a 3.3% weekly gain, which would snap a three week losing streak. Silver futures were looking at a 7.8% weekly rise, also marking its first weekly gain in about a month.