Gold prices finished higher Tuesday, with a sharply weaker U.S. dollar sending prices for the yellow metal up for a third session in a row to their highest level of the month so far.
August gold climbed $8.20, or 0.7%, to settle at $1,241.90 an ounce—their highest settlement since June 30, according to FactSet data. Silver for September delivery added 16.9 cents, or 1.1%, at $16.268 an ounce.
The closely watched measure of the buck, the ICE U.S. Dollar Index was trading down 0.5% at 94.632 after a low at 94.476—trading at its weakest levels since at least September. The dollar slump has been attributed to Republican lawmakers pulling a vote on a Senate bill to overhaul the Affordable Care Act, known Obamacare, in favor of plan to repeal the ACA bill and replace it at a later date.
The stumbles in getting the health-care bill passed have amplified doubts about President Donald Trump’s ability to get passage of a raft of Wall Street-friendly legislations, including tax cuts and other laws that may boost the buck.
A weaker dollar tends to be supportive to commodities, like gold, priced in the currency, making them more attractive to buyers using weaker monetary units.
Shakiness in the U.S. unit and diminishing expectations that the Federal Reserve will lift interest rates at a rapid clip, due to a spate of lackluster economic reports, has dealt a lift to gold futures, pushing it above its 200-day moving average at $1,230 an ounce. Traders tend to closely watch trading averages for signs of positive or negative momentum in an asset.