Spot Gold rose over 1% on Friday, holding in proximity to a 2-week peak of $3,345.45, and headed for a weekly gain amid lingering investor concerns over the US fiscal outlook.
Yesterday US President Donald Trump’s tax and spending legislation advanced in the House and is expected to move to the Senate. Should the bill pass, it would significantly increase US federal debt, potentially exacerbating existing investor concerns.
According to an estimate by the Congressional Budget Office, the tax bill may cost almost $4 trillion, which added to concerns over long-term fiscal instability.
Moody’s recent downward revision of the US sovereign credit rating reflected such concerns.
Rising geopolitical risks also provided support to the yellow metal this week. Reports emerged that Israel was planning a strike on Iranian nuclear sites, a move which would most likely lead to retaliation from the Islamic state.
Spot Gold was last up 1.04% on the day to trade at $3,329.29 per troy ounce.
The precious metal has gained 3.94% so far this week.
Meanwhile, the US Dollar Index has lost 1.30% so far this week. A weaker dollar makes dollar-priced Gold more appealing to international investors holding other currencies.
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