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Gold prices advanced for a fourth consecutive day and were poised for their longest winning streak in more than a month as investors await US president Donald Trump’s remarks to Congress on Tuesday.
Spot gold rose 0.4 per cent on Monday to $1,261.96 a troy ounce — and will pull off its longest streak of gains since January 17 if it holds on to these gains. The tentative rise in gold prices comes as investors await Mr Trump’s address — any details on his fiscal stimulus plans could help lift the precious metal, which investors perceive as a hedge against inflation.
The advance also comes as money managers and hedge funds increased their net long positions on gold, according to data from the Commodity Futures Trading Commission released on Friday.
“In a sharp reversal from the previous week, concerns surrounding the Trump fiscal agenda, a dropping US dollar, lower rates and concerns surrounding European elections convinced specs to materially grow gold length,” Bart Melek at TD Securities, said. “Money managers cut short positioning and increased long exposure amid speculation that the risk is growing that the Fed will hike rates later, rather than sooner.”
Meanwhile, investors will also closely watch remarks from Federal Reserve speakers, including chair Janet Yellen this week, for clues on the timing of the next interest rate rise.