Gold still set for weekly gain, although the yellow metal slipped early Friday as U.S. Treasury yields rose and the dollar held firm.
Higher Treasury yields increase the opportunity cost of holding bullion. However, in this case, the yields rose on inflationary expectations ahead of a likely U.S. stimulus package. Gold typically acts as a hedge against inflation, which kept a floor under bullion prices.
April gold futures rose slipped 90 cents Thursday to settle at $1,869.30 an ounce on Comex. The front-month contract rose 2.2% so far this week. There was no settlement Monday because of the U.S. Martin Luther King Day holiday. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the coronavirus pandemic. The February contract is down $25 an ounce to $1,840.60, while the DG spot price is $1,844.60.
New U.S. President Joe Biden has outlined plans for a $1.9 trillion stimulus package to help struggling Americans, including direct payments. About 900,000 Americans filed new applications for unemployment benefits last week, remaining at an elevated level because of the pandemic. In upcoming economic news, Market manufacturing PMI and existing home sales data are due out Friday.
In addition to expectations of stimulus from the U.S., the European Central Bank on Thursday reaffirmed a pledge to keep borrowing costs at record lows to support the economy during the coronavirus pandemic.
“The pandemic continues to pose serious risks to public health and to the euro area and global economies,” ECB President Christine Lagarde said Thursday at a press conference.
The COVID-19 virus has killed almost 2.1 million people worldwide and sickened more than 97.5 million. About 25% of the cases — and 20% of the deaths — are in the U.S. The country has more than 24.6 million cases, more than any other nation.
Front-month silver futures rose 0.3% Thursday to settle at $25.85 an ounce on Comex. The March contract advanced 4% this week. Silver surged 17% in December and 47% in 2020. The March contract is down over $0.55 an ounce to $25.285, while the DG spot price is $25.30.
Spot palladium fell 1% Thursday to $2,394.00 an ounce Thursday. It’s down 0.4% so far this week. Palladium rallied 2% in December and 26% in 2020. The DG spot price for palladium has slipped around $15 an ounce to $2,377.00.
Spot platinum gained 0.7% Thursday to $1,126.20 an ounce and is up 3.2% so far this week. The metal added 11% in December and 11% in 2020. The DG spot price is down $25 to $1,101.90 an ounce.
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