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PRECIOUS-Gold rises above $,as dollar dips on doubts Fed will taper soon1800

· Gold vaulted over the key $1,800 psychological level on Monday as a retreat in the dollar pushed investors to bullion, with rising coronavirus cases driving expectations that the U.S. Federal Reserve might delay tapering of economic support.

· Spot gold jumped 1.3% to $1,803.29 at 1:35 p.m. EDT (1735 GMT), after scaling its highest since Aug. 5 at $1,806.23.

· U.S. gold futures settled up 1.3% at $1,806.3 per ounce.

· “Stocks are up, dollar is down, and it’s all being driven right now by the likelihood that the Federal Reserve might push back tapering further due to the Delta variant” (of the coronavirus), said Bob Haberkorn, senior market strategist at RJO Futures.

· A spike in COVID-19 cases prompted the Fed to schedule its Aug. 27 annual symposium in Jackson Hole, Wyoming, virtually, with all eyes on Chair Jerome Powell’s speech for hints on the tapering timeline.

· Traders are weighing expectations the Fed might not be in a position to ease its policy anytime soon, “which is bullish for gold and silver,” Haberkorn said.

· Gold’s resurgence drove a jump in other metals too, with silver up 2.5% to $23.59 per ounce and palladium bouncing off a five-month low to gain about 6% to $2,408.69.

· Platinum climbed 2.4% to $1,019.44 per ounce.

· Helping gold’s breakout was a broad retreat in the dollar , making bullion cheaper for those using other currencies.

· Bullion’s rise came despite Wall Street’s rebound from last week’ sell-off.

· SPDR GOLD HOLDINGS: SELL MORE 4.9 Tonnes

· A move further above the $1,800 level for gold may need additional drivers, given technical resistance around the 100-day and 200-day moving averages, said FXTM analyst Lukman Otunuga.

But if economic data expected this week “paints a positive image of the U.S. economy, this could fuel Fed taper expectations – ultimately boosting the dollar while weakening gold,” Otunuga added.

· Fed's Jackson Hole shift shows Delta variant's ability to skew plans

The annual symposium, organized by the Kansas City Fed, will still take place online and the substance will be the same. Academic research papers will be presented and Fed Chair Jerome Powell will give a speech via webcast on Friday.

Yet the sequence of events last week shows the day-to-day recalibration underway over what is and isn't safe during the current U.S. COVID-19 surge, which is being fueled by the highly contagious Delta variant of the virus. The Fed's reaction to a county government's communication choices served as a high-profile example of how the pace of the economic recovery is being reshaped.

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U.S. business activity growth slowed for a third straight month in August as capacity constraints, supply shortages and the rapidly spreading Delta variant of the coronavirus weaken the momentum of the rebound from last year's pandemic-induced recession.

Data firm IHS Markit said on Monday its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 55.4 - the lowest since last December - from 59.9 in July. A reading above 50 indicates growth in the private sector.

The IHS Markit survey's flash services sector PMI fell to a reading of 55.2 from 59.9 in July. Economists polled by Reuters had forecast a reading of 59.5 this month for the services sector, which accounts for more than two-thirds of U.S. economic activity.

The survey's flash manufacturing PMI slid to 61.2 in August from July's all-time high reading of 63.4. Economists had forecast the index for the sector, which accounts for 11.9% of the economy, would dip to 62.5.

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Existing home sales increased 2.0% to a seasonally adjusted annual rate of 5.99 million units last month from June’s upwardly revised pace of 5.87 million units, the National Association of Realtors said on Monday. Sales were unchanged in the Northeast, but increased in the Midwest, South and the West.

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The IMF will distribute about $650 billion in new Special Drawing Rights to its members on Monday, providing a “significant shot in the arm” for global efforts to combat the COVID-19 pandemic, Managing Director Kristalina Georgieva said.

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