Gold hovers near 2020 record highs on softer dollar, weak US data

Gold prices hovered near record highs seen in 2020, trading steady above the key $2,000 level on Wednesday, as the dollar eased after weak U.S. economic data fanned expectations that the Federal Reserve might loosen its monetary policy trajectory.

FUNDAMENTALS

* Spot gold held its ground at $2,020.39 per ounce, as of 0123 GMT. U.S. gold futures were steady at $2,037.20.

* The dollar index was down 0.1%, making bullion cheaper for buyers holding other currencies. [USD/]

* Gold prices rallied 2% to hit their highest in more than a year on Tuesday after another round of weaker U.S. economic data indicated a slowing economy and strengthened expectations of a less-aggressive Fed policy.

* Data showed U.S. job openings in February dropped to the lowest level in nearly two years, suggesting the labor market was cooling. A separate report showed new orders for U.S.-manufactured goods fell for a second straight month in February.

* The Fed is seen done raising interest rates and starting to cut them in the summer. * But Federal Reserve Bank of Cleveland President Loretta Mester said while the economy appears on a path toward slowing down, the U.S. central bank likely has more rate hikes ahead of it.

* While gold is traditionally considered a hedge against inflation and economic uncertainties, higher interest rates dim the appeal for non-yielding bullion.

* Spot silver eased 0.1% to $24.99 per ounce, while platinum was 0.2% higher at $1,020.47 and palladium edged up 0.1% to $1,458.51.