Gold Breaks Above $1,800 as Dollar Weakens After Fed Commentary

(Bloomberg) -- Gold rose for a second straight day as the dollar weakened after U.S. Federal Reserve officials played down prospects of aggressive rate hikes coming imminently. 

The softness in the greenback helped gold cross the psychologically important $1,800-an-ounce threshold, which is just above the metal's average price last year. 

On Monday, Fed officials including Kansas City's Esther George and San Francisco's Mary Daly stressed that they want to avoid unnecessary disruptions to the U.S. economy as they prepare to start raising interest rates. The prospect of aggressive rate hikes put gold under pressure last week.

Read: Fed Officials Stress Not Jamming Brakes on Economy as Hikes Loom

Gold “has been finding support from the weaker U.S. dollar,” said Daniel Briesemann, an analyst at Commerzbank AG. 

Exchange-traded funds inflows are also providing support, Briesemann said. Those tracked by Bloomberg added more than 5 tons of bullion Monday, extending this year's gain to 42 tons.

Investors will be watching January's U.S. jobs report, out on Friday, for more clues on the trajectory for inflation.

Spot gold added 0.2% to $1,801.04 an ounce as of 2:41 p.m. in New York. Bullion for April delivery gained 0.3% to settle at $1,801.50 on the Comex.  Silver and platinum gained, while palladium slipped.

Markets in China and some other Asian countries will be closed for much of the week for the Lunar New Year holidays.

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