Gold edged higher as markets weighed President Joe Biden’s decision to end his reelection bid, which sparked fresh questions over whether the move will help or hinder Donald Trump’s chances of returning to the White House.
Bullion rose as much as 0.5% in early Asian hours, as the metal benefitted from haven appetite amid heightened uncertainty over what’s already been a tumultuous US election campaign. Biden said he would serve out his term but endorsed Vice President Kamala Harris to take his place as the Democratic nominee.
A slump in the dollar as markets opened on Monday also offered support to gold, with traders potentially leaning into the idea that Trump — should he win election — will push for a weaker US currency. A stronger greenback is usually a negative for bullion, which is priced in dollars.
Bullion hit a record high last week, after finding support this year as bets have increased the Federal Reserve will pivot to monetary easing. Lower rates are typically positive for gold as it doesn’t pay interest.
Spot gold was 0.5% higher to $2 411.33 as of 6:57 a.m. in Singapore. The Bloomberg Dollar Spot Index fell 0.2%. Silver gained.