Gold held an advance after the Federal Reserve strengthened its commitment to supporting the recovery in the world’s largest economy, and U.S. lawmakers made progress in getting a fiscal stimulus deal over the line.
The precious metal is on course for a third weekly gain, with the Fed promising at its final policy meeting of 2020 to maintain its massive asset-purchase program until it sees “substantial further progress” in employment and inflation. Chair Jerome Powell said that the case for fiscal stimulus is “very, very strong.” Gold’s rise has been aided by a weaker dollar.
Bullion is set to cap 2020 with the biggest annual gain in a decade on the prospects of further stimulus and curbs in several parts of the world as the coronavirus continues to wreak havoc. Germany saw its biggest rise in deaths since the pandemic began as Chancellor Angela Merkel hinted a hard lockdown will remain in force longer than planned. While vaccines have been developed, curbing some haven demand, challenges remain in immunizing populations.
Spot gold was steady at $1,863.12 an ounce at 8:33 a.m. in Singapore, after rising 0.6% on Wednesday. The precious metal is 23% higher this year after hitting a record above $2,075 in August. Silver, platinum and palladium were all little changed. The Bloomberg Dollar Spot Index held near the lowest since April 2018 and is on course for the eighth monthly drop in nine.
In the U.S, Congressional leaders are still haggling over the final details of nearly $900 billion in coronavirus aid as staffers try to write the legislative language needed for House and Senate votes this week. Senate Majority Leader Mitch McConnell said that he thinks “we’re gonna get there.”