BENGALURU. — Gold hit highest in more than a week on Wednesday as the dollar softened and demand for the safe-haven metal got a boost on concerns surrounding Italy’s plans to tackle budgetary deficit.
Risk appetite was hit after European Union (EU) officials expressed concerns about Italy’s budget plan, which would widen the deficit significantly. The deficit blow-out revived fears of the eurozone debt crisis.
However, the debt fears were tempered on reports that Italy will cut its budget deficit at a faster pace than expected.
Spot gold was up 0,1 percent at $1 203,31, as of 0752 GMT. Earlier in the session, the bullion touched the highest since 21September at $1208,31. It gained 1,3 percent on Tuesday in its biggest one-day percentage gain since 24 August.
In the previous session, spot gold broke above the 55-moving day average for only the second time since April.
US gold futures were up 0,1 percent to $1 207,06 an ounce.
“Gold has jumped a little bit on populist sentiments from euro zone, Italy deficit concerns, and fall in equities,” said Benjamin Lu, commodities analyst, Phillip Futures.