The precious metal rose as high as $1,370 during the trading session before dropping six dollars, but still trading in the green compared to the previous session. The 2016 high was $1,374.91.
“Gold is benefiting tremendously from the weaker dollar,” said ETF Securities analyst Nitesh Shah, as quoted by Reuters.
“With traders’ base case scenario to sell the dollar at all costs, gold prices should remain well supported on dips and could be poised to move even higher on the next US dollar wobble,” said Stephen Innes, APAC head of trading at OANDA.
The US dollar fell to its lowest level in three years against major currencies on Wednesday after US Treasury Secretary Steven Mnuchin said the US administration favors a weak dollar in trade.
On Thursday, Mnuchin confirmed his words.
“I thought my comment on the dollar was actually quite clear yesterday. I thought it was balanced and consistent with what I said before, which is we are not concerned with where the dollar is in the short term,” he said, as quoted by Bloomberg.
President Donald Trump’s administration has repeatedly said that a weak dollar helps make American-made goods more competitive with goods from China and other markets.