2021.01.0422:01:00UTC+00Gold Futures Settle Sharply Higher As Dollar Tumbles

Gold prices rose sharply on Monday, lifting the most actively traded futures contract to their highest close in about two months, as the dollar fell to a 2-1/2-year low.

An agreement on the long-awaited U.S. coronavirus relief bill, and expectations of further stimulus amid the continued surge in coronavirus cases weighed on dollar.

The dollar index, which tumbled to 89.42 in the Asian session, recovered to 89.94 later on in the day.

Gold futures for February ended up $51.50 or about 2.7% at $1,946.60 an ounce, the highest settlement since November 6. In percentage terms, the day's gains were the largest single-session returns more than eight months.

Silver futures for March closed higher by $0.950 or about 3.6% at $27.364 an ounce, while Copper futures settled at $3.5545 per pound, gaining about 1%.

Investors are on the lookout for Tuesday's runoff elections in the U.S. state of Georgia that will decide the control of the Senate.

Minutes of the Federal Reserve's December meeting will be released on Wednesday, with investors looking for fresh guidance on its asset purchases.