A small correction in the price of the Dollar triggered by the data showing a surprise contraction in the American economy in the first quarter, have sent prices of the yellow metal surging almost 1 percent higher.
The Dollar’s pause, after continuously scaling fresh peaks has also served to unveil the safe haven and inflationary hedge appeal of the precious metal.
The Dollar Index, which had on Thursday touched a high of 103.93 is now trading around 103.25.
Gold Futures for June settlement have however increased more than a percent to trade at $1,911.93, up 1.09 percent on an overnight basis. Prices oscillated between $1,892.62 and $1,921.05 versus the previous close of $1891.30.
The undeterred rally in the dollar, bolstered by the Fed’s aggressive stance of inflation combat had been a drag on gold prices, of late. The resultant surge in bond yields had also increased the opportunity cost of holding the non-interest-bearing bullion, causing the prices of the precious metal to head southward.