Gold gains as US dollar, yields stumble on Fitch downgrade

economictimes.indiatimes.com:

Gold prices edged higher on Wednesday as the U.S. dollar and Treasury yields were bogged down after Fitch downgraded the country's credit rating, souring confidence in the economy ahead of key data due this week. FUNDAMENTALS * Spot gold was up 0.2% at $1,948.43 per ounce by 0122 GMT, while U.S.

gold futures rose 0.3% to $1,985.60. * The U.S. dollar index and benchmark 10-year Treasury yields dropped after rating agency Fitch downgraded the U.S.

government's top credit rating, citing fiscal deterioration over the next three years and growing general government debt burden. * Gold, which is priced in dollars, is a favoured safe-haven investment in times of stress and economic uncertainty. * U.S.

central bankers expressed hope they can beat inflation without cratering the job market, though they also said doing so will require keeping rates high for some time. * Global factory activity remained in a slump in July, private surveys showed on Tuesday, a sign slowing growth and weakness in China were taking a toll on the world economy, though the picture in the Americas was notably less bleak than elsewhere. * U.S.

job openings fell to the lowest level in more than two years in June, but remained at levels consistent with tight labor market conditions. * China's currency regulators are asking some commercial banks to reduce or postpone their purchases of U.S. dollars in order to slow the yuan's depreciation, two people with direct knowledge of the matter said.