The yellow metal is getting off a weekly loss as bullion prices hit a strengthening US dollar. Gold was also affected by President-Elect Joe Biden’s stimulus, and relief spending plans that investors think lawmakers will not allow a large portion. In these unsettled times, where is the precious metal directed?
February gold futures turned on $4.40, or 0.24%, to $1,834.30 per ounce at 13:13 GMT on Monday on the New York Mercantile Exchange’s COMEX division. Last week, gold posted a 1.1% weekly fall, continuing to its bitter start to 2021.
Silver, the relative commodity to gold, covers the same downward pressure in the calendar year’s first few weeks. March silver futures totaled $0.089, or 0.36%, to $24.955 an ounce. The white metal has fallen 6% so far this year.
The US dollar is hanging at a four-week high versus multiple currency rivals, curbing gold’s increase. The US Dollar Index (DXY), which measures the dollar versus a basket of currencies, bound up 0.11% to 90.87, from an opening of 90.76. The DXY enjoyed a weekly increase of around 0.5%, lifting its year-to-date jump to more than 1%.
A more robust dollar is terrible for dollar-pegged commodities because it makes it more costly for foreign investors to buy.
Gold is mostly serving from positive economic data in China. Although the world’s second-largest economy came short of gross domestic product (GDP) estimates in the fourth quarter, China was the only significant economy to record yearly growth in 2020. This is positive news for the metals market after Beijing is one of the most significant yellow metal users.
Since early last year, physical gold was traded at a small premium in China for the first time, buoyed by increasing demand.
March copper futures rised
The Commodity Futures Trading Commission (CFTC) stated that critics cut their net-long positions in gold and silver contracts in the week closing January 12.
On Thursday, the incoming president described his $1.9 trillion stimulus package, which adds $1,400 in direct income support payments, extended lay-off benefits, and vaccination distribution. But market analysts consider that only $1.1 trillion will be approved, while gold markets were frustrated that the price-tag did not surpass $2 trillion.
However, the inflation interests remain rampant, particularly after the Federal Reserve encouraged financial markets that the central bank does not expect to taper monetary policy and cut interest rates anytime soon.
In additional metal commodities, March copper futures rised $0.0125, or 0.35%, to $3.6145 per pound. March platinum futures slid $5.90, or 0.54%, to $1,084.00 per ounce. March palladium futures declined $19.60, or 0.82%, to $2,375.50.
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