* FACTBOX-Who is winning the U.S. election? * Broader macro backdrop remains supportive for gold-
analyst
* Dollar slips to two-week low
* U.S. Fed policy announcement at 1900 GMT
(Updates prices)
By Sumita Layek
Nov 5 (Reuters) - Gold bounced to a one-and-a-half month
peak on Thursday as growing prospects of a Joe Biden victory in
a close U.S. election boosted hopes for larger stimulus and
dented the dollar, ahead of a Federal Reserve policy statement.
Spot gold XAU= surged 2.3% to $1,947.17 per ounce by 1:42
p.m. EST (1842 GMT), after hitting its highest since Sept. 21 at
$1,952.41. U.S. gold futures GCv1 settled up 2.7% at
$1,946.80.
"It looks like it's getting more and more clearer that we're
going to have a Democratic president next year," said Michael
Matousek, head trader at U.S. Global Investors, adding that it
will assure in bigger stimulus plans and weigh on the dollar.
Global stocks jumped, while the dollar fell to a two-week
low as Biden inched towards taking the White House following
victories in Michigan and Wisconsin. USD/ .N
Biden is expected to enact larger stimulus measures than
U.S. President Donald Trump, although investors remained wary
that a divided Congress could stymie Biden's fiscal
policy. Gold is considered a hedge against inflation and currency
debasement, which are likely to result from a large stimulus.
Market participants were now awaiting a Fed policy decision
due at 1900 GMT.
"We're going to hear verbiage out of the Fed that screams
for additional stimulus package," said David Meger, director of
metals trading at High Ridge Futures.
Traders also took stock of lawsuits filed by the Trump's
campaign in Michigan and Pennsylvania to stop vote counting.
"Beyond the U.S. election, the broader macro backdrop
remains supportive of elevated gold prices given our
expectations of further dollar weakness, real rates remaining
negative and further stimulus," said Standard Chartered analyst
Suki Cooper.
Other precious metals also posted sharp gains, with silver
XAG= gaining 4.9% to $25.09 an ounce. Platinum XPT= rose
2.2% to $888.33, while palladium XPD= jumped 3.4% to
$2,365.76.
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FACTBOX-Who is winning the U.S. election? bounces on dollar dip as U.S. elections enter final stretch
https://tmsnrt.rs/3oYAc82
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