Gold rebounds from early morning dip that was brought on by a stronger dollar and global optimism as Britain prepares to start COVID-19 vaccinations on Tuesday. The yellow metal dropped a touch over $10 an ounce, but sprung back as investors bought the dip.
Front-month gold futures rose 2.9% last week to settle at $1,840 an ounce on Comex. The February contract slipped $1.10 on Friday. Currently, the February contract is up over $2 an ounce to $1,842.30 and the DG spot price is $1,841.60.
Senators from both parties indicated Sunday that another coronavirus stimulus package was likely, with the details likely to come this week. Economic stimulus is typically considered bullish for gold. Pandemic-related lockdowns have sent millions of Americans into unemployment and curbed economic growth. U.S. health authorities are expected to issue emergency approvals of the Pfizer vaccine later this month.
Gold is up more than $300 — or 21% — so far this year as investors have flocked to the metal because of uncertainty from the coronavirus pandemic and the economy.
While the discussed stimulus package will be less than $1 trillion — smaller than some investors had anticipated — it’s still likely bullish for gold. Stimulus actions raise the specter of inflation, and gold is traded as a hedge against inflation.
The stimulus agreement grew more likely after data released Friday showed the recovery in the U.S. jobs market had slowed. While the unemployment rate slipped to 6.7%, employers added just 245,000 jobs last month, missing economists’ expectations of a 460,000 gain.
The COVID-19 virus has killed almost 1.54 million people worldwide and sickened more than 67 million. About 22% of the cases — and 18% of the deaths — are in the U.S. The country has almost 14.8 million cases, more than any other nation.
Alex Azar, the secretary for health and human services, forecast Sunday that all Americans who want to be vaccinated against the coronavirus should be able to get inoculated by the second quarter of 2021.
Front-month silver futures rose 7.1% last week to settle at $24.25 an ounce on Comex after the March contract rallied 0.5% Friday. The most active contract dropped 4.5% in November. The March contract is currently at $24.005 (down $.0249) and the DG spot price is $23.99 an ounce.
Spot palladium, which has gained renewed interest in recent days as a key component required for many of the world’s clean-energy plans, fell 2.3% last week to $2,373.20 an ounce, but it rallied 2.8% Friday. It advanced 8.3% in November. The DG spot price for palladium is currently down about $30 a ounce to $2,338.00, while platinum is down $39 to $1,029.30.
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