Gold gains on mounting pandemic, vaccine worries
· Gold rose on Friday as increasing coronavirus infections globally re-ignited concerns about the economic toll from the pandemic, while scepticism over the reach of a potential COVID-19 vaccine further boosted the safe-haven metal.
· Spot gold rose 0.5% to $1,884.76 per ounce. But bullion was still bound for its worst weekly loss since late September, down 3.4% so far, mainly hurt by initial euphoria over an effective vaccine from Pfizer earlier in the week.
· U.S. gold futures settled up 0.7% at $1,886.20.
· “We have got COVID-19 raging in the U.S. and the uncertainty surrounding that and the potential for some more economic damage in the coming months; all that is working in favour of gold market bulls,” Kitco Metals senior analyst Jim Wyckoff said.
Pfizer and BioNTech SE on Monday said their COVID-19 vaccine was more than 90% effective based on initial trial results.
“Everybody was excited about the vaccine, but then the grim realization sets in that it will probably not be available for general public consumption until late winter or spring and until then ... we’ve got to get through some very rough waters,” Wyckoff said.
Also supporting bullion, the dollar eased.
· Gold prices holding nearly 1% gains despite mixed U.S. PPI inflation data
The gold market is holding on to strong gains but continues to see little reaction to inflation data.
Friday, the U.S. Labor Department reported mixed wholesale inflation pressures; it said its Producer Price Index (PPI) rose 0.3% in October, following September’s 0.4% increase; the data were stronger than expected with economists’ forecasting an increase of 0.2%.
For the year, inflation is up 1.1%, the largest increase since February, the report said.
Meanwhile, core inflation pressures, which strips out volatile food and energy costs, rose 0.1% last month. The data missed expectations with economists looking for a 0.2% rise.
Annual core inflation rose 0.8% to 1% in October, the largest increase since March, the report said.
Gold prices have been largely unaffected by the latest inflation data as investors continue to follow the unbaiting spread if the COVID-19 virus. Investors’ concerns continue to swirl around financial markets that that virus will continue to devastate the global economy.
December gold futures last traded at $1,890 an ounce, up 0.89% on the day.
Economists pay close attention to producer prices as it is a leading indicator for consumer prices. Traditionally, companies pass on higher costs to their customers.
· “There is fear of a second wave with lockdowns and restrictions and the market has to work through (some) stimulus whether we’re in a lame duck situation or with a new president-elect,” said Eli Tesfaye, senior market strategist at RJO Futures. “So, the market at some point has to anticipate that cash and price in the potential inflation.”
· Gold is considered a hedge against inflation and currency debasement likely to result from large stimulus.
· Silver climbed 1.5% to $24.59 an ounce, platinum rose 1% to $888.76 and palladium fell 0.1% to $2,328.98.
· CORONAVIRUS UPDATES:
Global Cases: 54.80M
Global Deaths: 1.32M
U.S. Cases: 11.36M
U.S. Deaths: 251,832
· Covid cases in U.S. could be near zero in 6 months, UBS economist says
UBS had originally estimated that the number of coronavirus infections in the U.S. would approach zero by the end of 2021, but the vaccine news has made the bank bring that forecast forward by six months.
“We might get a situation where reported cases of Covid in the United States fall very close to zero in Q2 (second quarter) of next year. That six month difference, that two-quarter difference matters a lot, it means an extra 1 to 1.25 percentage point gain in GDP next year,” Seth Carpenter, chief U.S. economist at UBS, told CNBC’s Joumanna Bercetche on Thursday.
He added that the vaccine news “was very encouraging” because the efficacy rate came in much higher than analysts were anticipating.
The United States has experienced more than 10 million Covid-19 cases since the pandemic started. The country has seen record highs this week in terms of coronavirus hospitalizations and daily infections, with 153,496 cases on Thursday, according to Johns Hopkins University.
This comes as speculation mounts on whether the U.S. economy will be shut down once again. An advisor to President-elect Joe Biden has said that closing businesses for four to six weeks could help reduce the number of infections and get the economy on track until a vaccine is approved and distributed.
· Paying workers to stay home 4 to 6 weeks could contain pandemic, says Biden coronavirus advisor
· Biden Covid advisor warns that Thanksgiving travel is like ‘pouring gasoline on a fire’
· National lockdown to contain Covid surge is a ‘measure of last resort,’ top Biden health advisor says
A national lockdown of businesses and schools is a “measure of last resort,” even as cases continue to surge to record-highs across the U.S., a top coronavirus advisor to President-elect Joe Biden said on Sunday.
Covid-19 cases were growing by 5% or more in 47 states as of Saturday, based on a weekly average, according to a CNBC analysis of data compiled by Johns Hopkins University. The U.S. reported 166,555 new cases on Saturday, the second-highest daily number of new cases so far.
The U.S. is now reporting a weekly average of 145,401 cases every day, a more than 33% increase compared with a week ago and a record high average, according to Hopkins. The nation surpassed more than 11million reported Covid-19 cases on Sunday, adding an additional 1 million cases in less than a week.
· Fauci says Trump administration should work with Biden transition team on coronavirus response
· Germany plans 22 billion euros in COVID aid for companies in first half of 2021, sources say
· Italy extends lockdowns to more regions, tightens curbs
· British PM Johnson self-isolating after COVID-19 contact
· UK and EU making some progress on post-Brexit trade deal, UK negotiator says
· Trump strikes out in Arizona, Michigan, Pennsylvania ballot challenges, Biden’s lead more secure
President Donald Trump’s already long-shot efforts to reverse an apparent win for President-elect Joe Biden by challenging votes in courts suffered three big setbacks in Arizona, Michigan and Pennylvania on Friday.
But Trump still refused to concede the race, which he has falsely claimed to have won, even as experts say he has little if any hope left of invalidating enough Biden votes — in multiple states — to surpass the former Democratic vice president in the Electoral College tally.
In Arizona on Friday, Trump’s campaign dropped a legal challenge of a number of ballots in Maricopa County, saying Biden’s overall lead in the state is too large for the disputed ballots to make a difference.
In Michigan, where Biden last week was projected as the winner, a judge declined a request by Trump backers to block the certification of election results in Detroit.
And in Pennsylvania, Secretary of State Kathy Boockvar said she has determined not to order a recount and a recanvass of the election return in 67 counties.
For a recount to be ordered, Trump would have to be losing by less than .5% of the votes cast.
But Biden’s lead over Trump was 49.8% to Trump’s 48.9%, or more than 60,000 votes, as of Friday afternoon in the Keystone State, which has 20 Electoral votes.
Later Friday, a judge in Montgomery County, Pa., rejected a request from Trump’s campaign to halt the counting of nearly 600 ballots there, which the campaign claimed were missing their addresses under a signature on the outer envelope.
Court of Common Pleas Judge Richard Haaz in his ruling said that state law does not require a voter to provide an address on the envelope.
In the Michigan case, the judge rejected allegations by two poll challengers who claimed to have seen irregularities that allowed invalid ballots to be counted.
· Trump admits Biden won, but still won’t concede after falsely claiming election was ‘rigged’ - Biden team to meet vaccine makers
President Donald Trump appeared on Sunday to acknowledge losing the U.S. election but then backtracked and said he concedes “nothing,” while President-elect Joe Biden focused on tackling the coronavirus pandemic and set meetings with pharmaceutical companies developing vaccines.
· Top Biden aide says U.S. government must approve transition this week
· India seen facing a shortfall in total revenue for current financial year: Nomura
Despite a pickup in tax collections following the reopening of India’s economy, it is also “significantly behind” its targets on non-tax revenue and disinvestment, says Sonal Varma of Nomura Holdings. She adds that there’s still a “large funding gap” even with revenue collections picking up.
Reference: CNBC, Kitco, Reuters, Worldometers
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