On Tuesday, gold is making gains on the back of a weakness in the US dollar despite the risk-on sentiment in markets over optimism surrounding the beginning of the COVID-19 vaccine rollout across the US and Canada. At the time of writing, GOLD is trading at a little above $1,838.

Gold shares a negative correlation with the US dollar, and whenever the greenback weakens, it becomes more attractive for holders of other currencies to purchase the yellow metal. The US dollar has weakened since Monday as investors moved away from its safety to trade riskier currencies in global markets.

The precious metal also enjoyed support from the announcement of tighter lockdown measures across London despite Britain having started the rollout of Pfizer’s vaccine. Germany has also called for more restrictions while latest news reports suggest that Italy could also follow suit by announcing fresh restrictions during the upcoming holiday period.

However, gains in gold remain limited as the US began administering doses of the COVID-19 vaccine, raising hopes that the pandemic could soon be brought under control. The US has been the worst affected country in the world and has been experiencing a spike in fresh infections over the past few weeks.