This pointed to a greater risk appetite in the wider financial markets, reducing the dollar and making metal commodities more affordable for foreign investors.
February gold futures climbed $13.20, or 0.7%, to $1,896.40 per ounce at 13:43 GMT on Monday on the New York Mercantile Exchange’s COMEX division. Gold prices are getting off a weekly decline of around 0.4%, but they are yet up 25% year-to-date.
Silver, the relative commodity to gold, is returning after the Christmas break. March silver futures rose $0.862, or 3.33%, to $26.77 an ounce. The white metal also experienced a weekly decrease of higher than 1%. However, it climbed up 50% in the last trading week of 2020.
The equities arena was given a solid addition on Monday after President Donald Trump stated that he signed a $900 billion COVID-19 relief package and a $1.3 trillion government spending program into law.
Notwithstanding pushing the sweeping epidemic-aid law over the last week, alluding to its extreme contents, he approved the bill
He provided Congress a formal rescission request, redlining elements that his administration considered wasteful items.
The bill combines $600 direct-income support payments, $300 in improved lay-off insurance (UI) benefits for 11 weeks, $248 billion for Paycheck Protection Program (PPP) credits, $25 billion in rental support, and $30 billion into the acquisition and disposition of the Pfizer and Moderna coronavirus vaccines.
The US Dollar Index dropped
Market analysts think that this could be the lowest risk position for gold markets, implying that 2021 could see an assembly for the yellow metal because of inflation concerns. Plus, President-Elect Joe Biden and prominent Democratic leaders have pledged additional incentives once he takes office next month.
A lower dollar added to gold’s rise on Monday. The US Dollar Index gauges the dollar versus a basket of currencies. This week, it dropped 0.23% to 90.12, from an opening of 90.22. The index fell 1% last week, and it will end 2020 down lower than 6%. A weaker dollar is beneficial for dollar-pegged commodities because it makes them more affordable for foreign investors.
Could gold retest $2,000 the following year? With the Federal Reserve’s questionable decision to toughen monetary policy and the US government expected to spend more, gold has its popular components.
In different metal markets, January copper futures pinned on $0.033, or 0.93%, to $3.5955 per pound. January platinum futures added $22.90, or 2.235%, to $1,051.80 per ounce. January palladium futures rose $122.60, or 5.23%, to $2,468.50 an ounce.