Gold gains ground near one-week high as dollar reverses lower

Gold prices rose in European trade on Monday, maintaining gains for the fifth day in a row and almost hitting week highs as dollar reversed lower after recent gains. 

Dollar is weighed down by prospects the Fed will scale down its rate hike next December from 75 basis points to only 50 basis points.

Gold Prices Today

Gold prices rose 0.25% to $1,758 an ounce, after closing up 0.1% on Friday, the fourth profit in a row, hitting one-week highs at $1,761.

Gold rose 0.5% last week, the third weekly profit in a month, as the dollar weakened on Fed rate prospects.

The Greenback

The dollar index fell over 0.3% on Monday after a 0.4% profit, heading for three-month lows at 105.34 against a basket of major rivals.

The dollar rose at this week's open amid developments in China on the Covid 19 front with rare protests spreading across the country.

However it reversed quickly lower as prospects of a reduced 0.5% rate hike by the Fed in December directed the decline in the end.

Fed Rates

Now markets expect a 75% chance of a 0.50% rate hike by the Fed in December, and a 25% chance of a 0.75% chance.

Data

Markets await a batch of US data later this week to calibrate their expectations precisely, especially Fed Chair Jerome Powell's speech and the payrolls report for November. 

Powell is speaking on the economy and inflation tomorrow, expected to include important clues for the path forward for policies. 

The SPDR

Gold holdings at the SPDR Gold Trust rose 2.03 tones on Friday to a total of 908.96 tones, the highest since November 14.