By Gina Lee
Investing.com – Gold gave up its earlier modest gains on Friday morning in Asia even as the yellow metal rose to a one-week high during the previous session.
Gold futures were down by 0.05% at $1,744.65 by 10 PM ET (3AM GMT) as the boost in oil prices increased investors’ risk appetite.
Oil futures rose during the previous session as the U.S. House passed a $484 billion COVID-19 relief bill overnight, its fourth bill to support the U.S. economy as it weathers the COVID-19 pandemic storm.
“Supporting gold is the continuation of global central bank stimulus, particular today ... Here in the U.S. we’re voting on an additional $500 billion stimulus bill,” said David Meger, director of metals trading at High Ridge Futures.
More measures are likely to be forthcoming as the distributed funds are quickly used up, and the U.S. Labor Department also said overnight that an additional 4.427 million people were unemployed last week, totaling a record 26 million unemployed over the past five weeks.
“The unemployment rate seems poised to hit the 20% level and this alone should be reason enough for the Federal Reserve and Trump administration to keep throwing stimulus into the economy,” Edward Moya, senior market analyst at broker OANDA, said in a note.
“Gold’s climb towards $1,800 per ounce continues. The stimulus trade is not going away anytime soon and that should mean record highs for gold (in dollar terms) by the summer.