Ilya Naymushin | Reuters
Gold surged as much as 1.4% to hit a nine-year peak on Tuesday, boosted by a sell-off of the dollar and expectations for increased stimulus to aid the recovery of pandemic-hit economies, while silver dashed past $20 for the first time since September 2016.
Spot gold rose 1.1% to $1,834.97 per ounce, after hitting its highest since September 2011 at $1,841.01 per ounce.
U.S. gold futures rose 1.2% to $1,838.60 per ounce.
"The U.S. dollar has dropped as the world is looking a little bit better ... interest rates have fallen across the yield curve and that again is another factor helping gold," said Bart Melek, head of commodity strategies at TD Securities.
The U.S. dollar, viewed as safe-haven rival to bullion, hit more than a four-month low.
U.S congressional leaders are set to discuss a fresh stimulus package this week, with the Republicans announcing plans to seek another $1 trillion in economic relief.
Adding to the support, European Union leaders clinched a "historic" deal on a massive stimulus plan on Tuesday morning.
Gold will push towards record highs over the next 18 months, a Reuters poll showed, even as low jewellery sales in Asia and the prospect of economic recovery will hinder further gains.
"As economic uncertainty fades, demand for safe-haven assets including gold should fall. However, this is only likely to take a little shine off the gold price, as ultra-low real yields remain a key support," Capital Economics economist James O'Rourke wrote in a note.
In other metals, silver rose 5.3% to $20.95 per ounce, having earlier hit its highest since July 2014 at $21.18.
"Silver is starting to outperform gold here. On the one hand, it's obviously appreciating on the basis of increased appeal for precious metals," IG Markets analyst Kyle Rodda said.
"On top of that, there's likely to be an element of silver catching a bit on a rebound in global industrial activity."
Palladium jumped 5.02% to $2,157.97 per ounce, having hit a peak since April 21.
Platinum rose about 4% to $876.89 per ounce, having climbed to a peak since March 11.
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July 21, 2020 at 12:03PM
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Gold jumps over 1% to over 9-year peak as dollar stumbles - CNBC
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