Gold opens the week at a new historic peak, exceeding $2,733.

Gold prices witnessed a new increase during trading on Monday, as gold extended its gains for the third consecutive session, achieving an increase of more than $10, which helped it to record a new historical peak for the second session in a row, despite the recovery seen in U.S. Treasury yields and the U.S. dollar today.

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In terms of trading, spot gold prices rose by about 0.45% to reach $2,733.84 per ounce, while December gold futures increased by 0.60% to record $2,746.50 per ounce.

What Helped Gold Achieve These Gains?

The People's Bank of China announced this morning a reduction in the primary lending rates - the main interest rate in China - for one-year and five-year deposits by 25 basis points, bringing them to 3.10% and 3.60%, respectively, as part of its easing measures to support the struggling economy, after recent data showed signs of weak consumer and producer price inflation in the People's Republic.

The increase came amid improved investor sentiment regarding the recovery of industrial demand for gold in China, the world's largest consumer of the yellow metal, which provided significant support to gold that remains bolstered also by ongoing geopolitical tensions in the Middle East, despite the clear recovery seen in both the dollar and Treasury yields.

The dollar index – which measures the performance of the U.S. currency against a basket of six other major currencies – rose by about 0.24% to reach 103.68 points, putting some pressure on gold prices denominated in dollars. However, this only limited the gains, in contrast to the significant support received by gold prices from the People's Bank of China's decision this morning.