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Gold Up Over U.S. Stimulus Uncertainty

Published 12/10/2020, 11:48 PM
Updated 12/10/2020, 11:51 PM
© Reuters.
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By Gina Lee

Investing.com – Gold was up on Friday morning in Asia, as disappointing jobs data from the U.S. sinks in and uncertainty over the latest U.S. stimulus measures and Brexit talks remains.

Gold Futures were up 0.23% at $1,841.70 by 12:47 AM ET (4:47 AM GMT). The dollar, which usually moves inversely to the yellow metal, was down on Friday.

The U.S. saw 853,000 jobless claims filed during the past week, more than the 725,000 in forecasts prepared by Investing.com and the previous week’s 716,000 claims. The data, released on Thursday, suggested that the number of claims increased as more businesses shut down due to ever-increasing numbers of COVID-19 cases in the U.S.

Negotiations between the Democrats and Republicans over the stimulus measures continue as they race against a Dec. 11 deadline to avert a government shutdown. Senate Majority Leader Mitch McConnell has expressed support for Treasury Secretary Steven Mnuchin’s $916 billion proposal and emphasizing the need to do “everything we can” to help the economy. However, House of Representatives Speaker Nancy Pelosi is putting her support behind an alternate $908 billion plan, which is still being drafted by a bipartisan group of lawmakers.

Across the Atlantic, the European Central Bank (ECB) deployed another round of monetary stimulus totaling EUR500 billion ($605.19 billion). ECB will continue its ongoing bond purchase stimulus by EUR500 billion euros to EUR1.85 trillion and will extend its support program until at least March 2022 from the current earliest end date of mid 2021, it said after its policy meeting on Thursday.

The Federal Reserve also convened for its policy meeting on Thursday.

The U.K. and the European Union are also working to reach a Brexit trade agreement by Sunday’s deadline set by U.K. Prime Minister Boris Johnson and European Commission President Ursula von der Leyen.

Meanwhile, the U.S. Food and Drug Administration (FDA) inched closer to approving a COVID-19 vaccine on Thursday. A panel of outside advisers voted 17-4 to endorse emergency use of BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE:PFE) and BioNTech SE (F:22UAy), with the FDA expected to authorize emergency use of the vaccine within days. Vaccine distribution and inoculations in the U.S. are expected to begin almost shortly thereafter.

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