PRECIOUS-Gold hits one-week high on U.S. pandemic aid cheer

(Updates prices)
* Silver hits 1-week peak
* Gold could sustain above $1,900/oz if dollar weakens -
analyst
* Interactive graphic tracking global spread of coronavirus:
https://tmsnrt.rs/3mvcUoa

By Nakul Iyer
Dec 28 (Reuters) - Gold prices rose as much as 1.3% on
Monday as investors welcomed U.S. President Donald Trump's
signing of a long-awaited pandemic aid bill, with a weaker
dollar lending further support.
Spot gold XAU= gained 0.6% to $1,886.71 per ounce by 0741
GMT, after earlier hitting its highest since Dec. 21 at
$1,900.04.
U.S. gold futures GCv1 were up by 0.4% at $1,889.90.
Trump on Sunday signed into law a $2.3 trillion pandemic aid
and spending package, restoring unemployment benefits to
millions of Americans and averting a partial federal government
shutdown. Investors now eye a U.S. House of Representatives vote on
Monday to increase coronavirus relief checks to individuals from
$600 to $2,000, with Trump saying the Senate "will start the
process" to approve higher payments.
"Even without extra stimulus, gold could climb higher ...
Trump's signature (on the stimulus bill) was the last major risk
point to the bull market," said Jeffrey Halley, a senior market
analyst at OANDA.
Gold is seen as a hedge against inflation likely to result
from large stimulus measures
"We've been talking about this deal for a long time, so how
much the market is going to follow through will be the big
question," said Stephen Innes, chief global market strategist at
financial services firm Axi.
To sustain itself above $1,900, gold will likely need the
dollar to weaken further, he added.
The dollar .DXY was down 0.2% against rivals, lifting
bullion's appeal for other currency holders. USD/ .
A daily close for the gold/silver ratio below 69.50 would be
a bullish technical development for both metals, implying
further meaningful gains lie ahead, OANDA's Halley said.
Silver XAG= was up 2% to $26.36 an ounce, after hitting a
one-week peak of $26.75 earlier in the session. Platinum XPT=
climbed 0.8% to $1,031.64 and palladium XPD= rose 0.3% to
$2,356.18.