Gold hits 3-week high as dollar falls

Spot gold was down 0.3% at $1,760.53 an ounce by 0533 GMT. Bullion hit its highest level since July 6 at $1,767.79, hitting Friday.

U.S. gold futures fell 0.3% to $1,776.50 an ounce.

“The USD is in a slump, pushing gold higher. Expectations are converging around a rapidly slowing economy and pointing to less aggressive tightening,” said Stephen Innes, managing partner at SPI Asset Management.

Traders currently estimate a 31% chance it will maintain its current rate of 75 basis points hike at its next meeting in September, with a 69% chance of a smaller half-point hike.

The dollar was at a three-week low against its rivals as greenback-held gold became less expensive for other currency holders. [USD/]

Gains in the precious metal were capped by the benchmark 10-year Treasury yield in the US, which moved from a four-month low. [USD/] [US/]

Gold posted its biggest weekly gain since March amid speculation the central bank will slow the pace of rate hikes as the US economy slows, ANZ analysts said in a note.

Attention will now turn to Friday’s expected monthly US jobs report, which will influence the central bank’s blueprint for fighting inflation.

Meanwhile, shares of the SPDR Gold Trust, the world’s largest gold-based exchange-traded fund, rose 0.06% to 1,005.87 mt on Friday. [GOL/ETF]

Disappointing Chinese economic data fueled investors’ appetite for riskier assets. [MKTS/GLOB]

On the technical front, spot gold is facing strong resistance at $1,770 an ounce at $1,756 an ounce, according to Reuters technical analyst Wang Tao. [TECH/C]

Elsewhere, spot silver fell 0.9% to $20.13 an ounce, platinum fell 0.7% to $890.52 and palladium fell 1.6% to $2,093.71.