Gold prices edge up in quiet trade as dollar holds steady on US tax overhaul

London (Dec 20)  Gold prices inched higher in quiet trade on Wednesday as the dollar held steady on expectations the US government would pass the country's biggest tax overhaul in 30 years.

Spot gold had risen 0.30 percent to $1,265.10 an ounce by 19:03.

"There is no news driving this other than perhaps some risk-aversion as Bitcoin fell by 10 percent overnight," said Jeffrey Halley, a senior market analyst from OANDA.

"Gold has resistance at $1,265 followed by the 200-day moving average at $1,269," Halley said, adding that immediate support for the metal would come in at $1,261 an ounce.

Meanwhile, the dollar was supported after the House of Representatives on Tuesday approved the proposed US tax overhaul, though Congressional Republicans will likely need to hold another vote later on Wednesday due to procedural issues.

"The better-than-expected housing data in the US weighed on investor appetite. A lack of safe-haven buying as well as stronger equity markets have been a major factor behind the lackluster performance in recent weeks," ANZ analysts said.

Upbeat US housing data and the House's approval of the tax overhaul boosted US Treasury yields.

"Gold is coming up from a cyclical bottom. It's going to get quieter due to the upcoming holiday long-weekends," said MunChun Loh, director of Private Wealth at GoldSilver Central Pte Ltd in Singapore.

GlobalTimes

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