Gold prices hover near record peak on US election jitters

Gold prices near record high: Gold prices lingered near record highs on Tuesday, supported by uncertainty surrounding the upcoming US presidential election, while investors awaited key economic data for clues on the Federal Reserve's interest rate trajectory.

Spot gold XAU= was up 0.5 per cent at $2,755.42 per ounce, as of 0226 GMT. Prices hit a record high of $2,758.37 last Wednesday.

US gold futures GCv1 gained 0.4 per cent to $2,768.10.

"The lead-up to the upcoming US elections may continue to offer traction for its status as a hedge against market turbulence, further supported by a temporary breather in the US dollar and Treasury yields overnight," IG market strategist Yeap Jun Rong said. 

"While stronger economic data may support more patience in Fed's easing process, we may expect gold prices to stay supported, with rate expectations well-anchored around a smaller 25 basis point in November."

With just eight days until the Fed's rate decision, a series of critical events is set to influence the US central bank's choice.

Data this week features US job openings due at 1400 GMT, ADP employment on Wednesday, US Personal Consumption Expenditures on Thursday, and payrolls report on Friday. Then comes Nov. 5, the day Americans go to the polls to elect a new president.

Markets are pricing in about 98 per cent chance of a 25-basis-point rate cut by the Fed, according to CME's FedWatch Tool.

Lower rates reduce the opportunity cost of holding gold, which is also seen as a safe asset during times of economic and political turmoil.

Elsewhere, at least 60 people were killed and dozens wounded in Israeli strikes on Lebanon's eastern Bekaa Valley, two security sources and the mayor of Baalbek told Reuters.

Spot silver XAG= was up 1.2 per cent at $34.0875 per ounce, palladium XPD= rose 1.4 per cent to $1,047.05, platinum XPT= added 0.8 per cent to $1,228.00.