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Gold bounces above $2,000/oz on sliding dollar

· Gold rose over 1% to reclaim the key $2,000 an ounce level again on Tuesday as the dollar plunged to two-year lows and the U.S. Treasury yields ticked lower, while investors awaited minutes from the U.S. Federal Reserve’s latest meeting.

· Spot gold rose 0.9% at $2,004.21 per ounce, after hitting a one-week peak of $2,014.97. U.S. gold futures settled up 0.7% at $2,013.1.

· “People are watching the dollar index and its pretty alarming how its breaking down and we’re seeing all these hard assets like gold and silver rising up in tandem,” said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.

“We’re going to run back up to the all-time highs, we had a healthy correction in the gold market, a lot of people who jumped on the bear side of the market are going to end up reversing course.” The dollar index hit its lowest since May 2018 and the benchmark 10-year U.S. Treasury yields moved lower.

· Gold reversed course from earlier in the session, when prices briefly turned negative after the benchmark S&P 500 index hit record highs.

· Investors were now awaiting minutes from the Fed’s last meeting, due on Wednesday.

· Bullion prices have surged 32% this year as unprecedented global stimulus fuelled fears of inflation and currency debasement.

· “We see yield of the real rates falling again, so there is an increase in inflation expectation probably related to the aggressive fiscal stimulus measures,” said UBS analyst Giovanni Staunovo.

· Also helping gold, U.S. Treasury Secretary Steven Mnuchin on Tuesday said President Donald Trump wants to move forward with more economic aid amid the coronavirus pandemic.

· Among other metals, silver climbed 2.2% to $28.01 per ounce after rising as much as 3.8%.

· Platinum rose 1.1% to $960.39, while palladium eased 0.2% to $2,195.78.

· CORONAVIRUS UPDATE:

Global cases: More than 22.29 million

Global deaths: At least 783,470

U.S. cases: More than 5.65 million

U.S. deaths: At least 175,000

· Brazil coronavirus cases top 3.4 million, death toll nears 110,000

· Pelosi emphasizes need for COVID-19 deal 'now'

U.S. House of Representatives Speaker Nancy Pelosi said on Tuesday that Democrats in Congress are willing to cut their coronavirus relief bill in half to get an agreement on new legislation, which a senior aide said did not signal a change to her position.

“We have to try to come to that agreement now,” Pelosi said in an online interview with Politico. “We’re willing to cut our bill in half to meet the needs right now. We’ll take it up again in January. We’ll see them again in January. But for now, we can cut the bill in half.”

A senior House Democratic aide said Pelosi was reiterating a standing call by Democrats for the White House and Republicans to meet them “half way” on coronavirus relief.

Pelosi also said she did not want to wait to reach a deal at the end of September, when Congress will need to agree on funding to keep the government open during the next federal fiscal year, which begins Oct. 1.

· Despite U.S. sanctions bid, Iran aims to keep nuclear deal alive until U.S. election

The fate of a fragile 2015 nuclear deal between Iran and world powers hinges on the result of the U.S. presidential election in November, not a planned U.S. bid this week to trigger a return of all U.N. sanctions on Tehran, said several Iranian officials.