Gold rallies to 1-1/2 month peak as dollar wilts on Biden victory bets
· Gold bounced to a one-and-a-half month peak on Thursday as growing prospects of a Joe Biden victory in a close U.S. election boosted hopes for larger stimulus and dented the dollar.
· Spot gold surged 2.3% to $1,947.16 per ounce, after hitting its highest since Sept. 21 at $1,952.41. U.S. gold futures gained 2.9% to $1,951.80.
· “It looks like it’s getting more and more clearer that we’re going to have a Democratic president next year,” said Michael Matousek, head trader at U.S. Global Investors, adding that it will assure in bigger stimulus plans and weigh on the dollar.
· Global stocks jumped, while the dollar fell to a two-week low as Biden inched towards taking the White House following victories in Michigan and Wisconsin.
· Biden is expected to enact larger stimulus measures than U.S. President Donald Trump, although investors remained wary that a divided Congress could stymie Biden’s fiscal policy.
· Gold is considered a hedge against inflation and currency debasement, which are likely to result from a large stimulus.
· The Federal Reserve held short-term borrowing rates near zero in a decision Thursday that characterized the economy as growing but not near where it was before the coronavirus pandemic hit.
· Traders also took stock of lawsuits filed by the Trump’s campaign in Michigan and Pennsylvania to stop vote counting.
· “Beyond the U.S. election, the broader macro backdrop remains supportive of elevated gold prices given our expectations of further dollar weakness, real rates remaining negative and further stimulus,” said Standard Chartered analyst Suki Cooper.
· Other precious metals also posted sharp gains, with silver gaining 4.5% to $24.99 an ounce. Platinum rose 3.4% to $898.71, while palladium jumped 5.2% to $2,408.61.
· CORONAVIRUS UPDATES:
· U.S. daily coronavirus cases top 100,000 for the first time
The number of new daily coronavirus cases recorded in the U.S. surpassed 100,000 for the time, according to a tally by Johns Hopkins University.
The data showed 111,897 new Covid-19 infections were recorded on Wednesday, up from 91,530 cases on Election Day.
· U.S. Covid-19 cases surge to dangerous levels as election remains on razor’s edge
· Job growth expected to have slowed in October, as rehirings drop off, layoffs increase
Job growth was expected to total 530,000 in October, and the unemployment rate is expected to fall to 7.7%, according to Dow Jones. That number includes about a 150,000 decline in public sector jobs from the end of temporary positions for workers conducting the census.
That compares to 661,000 jobs created in September, and an unemployment rate of 7.9%. The employment report is released at 8:30 a.m. ET Friday.
· China’s vice foreign minister hopes new U.S. administration will ‘meet China halfway’
As the world waits for news on who will become the next U.S. president, Le said he hoped the election would proceed stably and smoothly. That’s according to a CNBC translation of a Chinese state media report about Le’s remarks Thursday at a press conference about an unrelated upcoming summit.
· Britain extends its coronavirus furlough program until the end of March
The U.K.‘s finance minister announced Thursday that the country’s furlough scheme, which subsidizes workers’ wages that are unable to work due to the coronavirus pandemic, will be extended to March 2021.
“The economic recovery has slowed, and the economic risks are skewed to the downside,” Chancellor Rishi Sunak told the House of Commons, flanked by Prime Minister Boris Johnson.
· Brexit means major changes for Irish firms whether there’s a trade deal or not
If no such agreement is reached, companies will have to make separate data transfer arrangements with customers and partners.
Reference: CNBC, Reuters, Worldometers
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