Gold slipped on Monday, near the six-week trough that was hit earlier in the session, driven by a robust dollar and higher U.S. Treasury yields amid expectations of more fiscal stimulus.
Front-month gold futures tumbled 3.2% last week to settle at $1,835.40 an ounce on Comex after the February contract plummeted $78.20 Friday, erasing most of December’s rally of 6.4%, or $114.20. The yellow metal climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the coronavirus pandemic. Currently, the February contract is up $3.00 an ounce to $1,838.4 and the DG spot price $1,843.00.
Earlier last week, political uncertainty in the U.S. and the hopes of additional stimulus measures in the Democratic Congress which will take power on Jan. 20, when President-elect Joe Biden and Vice President-elect Kamala Harris are sworn in, supported gold, which peaked at a closing high of $1,954.40 on Jan. 5.
Gold also fell as it lost some of its luster as a hedge against economic uncertainty, when Federal Reserve Vice Chair Richard Clarida said Friday that the U.S. economy was heading for an “impressive” year because of the coronavirus vaccine rollouts and the potential for more stimulus.
The political situation, the state of the COVID-19 pandemic and questions about the economy are all likely to continue to drive precious metals this week.
The U.S. lost 140,000 jobs in December, the first decline in eight months, as coronavirus cases surged to records, data released Friday showed. Economic restrictions across the country have kept people out of work.
In economic news this week, U.S. inflation data for December is due out Wednesday, along with the Federal Reserve’s Beige Book, including reports on economic conditions by each of the 12 regional banks. Weekly initial jobless claims are due Thursday, with industrial production, retail sales and producer price index data Friday.
The COVID-19 virus has killed more than 1.93 million people worldwide and sickened about 90.3 million. About 25% of the cases — and 19% of the deaths — are in the U.S. The country has more than 22.4 million cases, more than any other nation.
Front-month silver futures fell 6.7% last week to settle at $24.64 an ounce on Comex after the March contract tumbled 9.6% Friday. Silver surged 17% in December and 47% in 2020. The March contract is currently up over $0.24 an ounce to $24.880 and the DG spot price is $24.91.
Spot palladium slipped 3.9% last week to $2,356.00 an ounce and lost 3.4% Friday. It rallied 2% in December and 26% in 2020. Currently, the DG spot price is down $17 a ounce to $2,365.00.
Spot platinum lost 1.3% last week to $1,059.30 an ounce and fell 5.9% Friday. The metal added 11% in December and 11% in 2020. The DG spot price is currently off over $45 an ounce to $$1,023.60.
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