Safe-haven gold on track for best month in seven

Gold prices climbed to a record high on Thursday and were headed for their best month in seven on safe-haven demand ahead of the US presidential election, while investors awaited US inflation report for clues on the interest rate path.

Spot gold was steady at $2,786.89 per ounce after hitting a record high of $2,790.15 earlier in the session. Prices have firmed 6 per cent for the month so far.

US gold futures dipped 0.1 per cent to $2,797.80.

The November 5 US election has entered its crucial final phase, with opinion polls indicating a close fight to call a winner between Republican former US President Donald Trump and Democratic Vice President Kamala Harris.

"Rise in gold looks a lot like one of the Trump trades, or effectively a hedge against greater deficit spending in the United States," said Kyle Rodda, financial market analyst at Capital.com.

Investors' focus will be on core personal consumption expenditures (PCE) data due later today. The September core PCE price index is expected to have increased 0.3 per cent, following August's 0.1 per cent gain.

"Traders want to buy gold whether it rises or falls, and that has kept retracements small and consolidations tight. And its trend seems poised to continue higher should PCE inflation come in at 0.2 per cent m/m or less," said Matt Simpson, senior analyst at City Index.

US weekly jobless claims, due later in the day, and payrolls report on Friday are also on radar.

Traders see a 96 per cent chance that the Fed will deliver a quarter-point reduction in short-term borrowing costs next week.

Bullion is considered a safe investment during economic and geopolitical uncertainties and thrives in a low interest rate environment.

Spot silver fell 0.3 per cent to $33.68 per ounce, platinum was flat at $1,008.68, and palladium fell 0.6 per cent to $1,141.00. All three metals were on track for a monthly gain.

Manufacturing activity in key metals consumer China expanded in October for the first time in six months, an official factory survey showed, supporting policymakers' optimism that recent fresh stimulus will get the economy back on track.