Gold edged higher on Tuesday, supported by a retreat in the dollar after an apparent breakthrough in Brexit negotiations between the European Union and Britain, although rallying equities capped bullion’s gains.
Spot gold rose 0.2 percent to $1,295.89 per ounce as of 1055 GMT, while US gold futures were up 0.4 percent at $1,296.20.
Some dollar weakness emerged due to the Brexit talks, in turn providing short-term support to gold prices, Capital Economics analyst Ross Strachan said.
The dollar fell from near three-month highs hit in the previous session, making bullion cheaper for holders of other currencies, while sterling soared.
Capping gold’s rise, last-minute tweaks to Britain’s arrangement for leaving the EU triggered gains in global stocks, having soothed investor worries about a possible no-deal exit.
British lawmakers were preparing to vote on a divorce deal at around 1900 GMT after Prime Minister Theresa May won fresh assurances from the EU.
“However, if the deal is voted through this time and risk appetite increases as a result, gold is likely to come under pressure again,” Commerzbank analysts wrote in a note.
The yellow metal has recently found some support from increasing concerns about global growth, briefly rising above $1,300 on Friday. Weak US jobs data and modest retail sales in January were seen as signs of a US economy losing momentum.
Investors were now focused on the US consumer price index due at 1230 GMT and on US-China trade negotiations.
Gold could rise to $1,400 by the end of 2019, with global growth concerns a factor underpinning the advance, Strachan said.