Gold climbs on U.S. stimulus hopes post Fed statement
· Gold rose on Wednesday on prospects for more stimulus measures after the U.S. Federal Reserve pledged to keep its benchmark interest rate near zero until an economic recovery is complete.
· Spot gold was up 0.5% at $1,862.72 an ounce by 4:16 p.m. EST (2116 GMT). U.S. gold futures settled up 0.2% to $1,859.10.
· Fed Chair Jerome Powell said in a news conference the U.S. economy might take continued support from both fiscal, monetary policy for recovery.
· "Powell managed to quell an initial market sell-off by reassuring that a very vigilant Fed would not hesitate to expand support if necessary," said Tai Wong, head of base and precious metals derivatives trading at BMO.
"Powell is quite bullish for H2'21 with the vaccines but remains quite concerned about the next four to five months. Gold in particular held key support under $1,850 and bulls will read the sharp bounce higher is a repudiation of the downside."
· Lawmakers in Congress were "closing in" on a $900 billion COVID-19 aid bill that would include $600 to $700 stimulus checks and extended unemployment benefits.
· Bullion has risen over 22% so far this year, banking on its appeal as a hedge against inflation likely due to the unprecedented stimulus unleashed in 2020.
· The Fed promised to keep funnelling cash into financial markets to fight the recession, even as policymakers' 2021 outlook improved following initial rollout of a coronavirus vaccine.
· Positive news on vaccines has lifted hopes over quick economic recovery. However, investors still remain concerned over surging coronavirus cases.
· Silver gained 3.5% to $25.35 an ounce, while platinum fell 0.4% to $1,032.71. Palladium rose 0.6% to $2,331.71.
· "Unless the current wave of infections derails the global economy, recovering industrial production may further boost silver and the PGMs (platinum group metals)," HSBC analyst James Steel said in a note.
· CORONAVIRUS UPDATES:
Global Cases: 74.50M (+708,692)
Global Deaths: 1.65M (+13,343)
U.S. Cases: 17.38M (+239,614)
U.S. Deaths: 314,519 (+3,428)
U.K. Cases: 1.91M (+25,161)
U.K. Deaths: 65,520 (+612)
TH Cases: 4,261 (+15)
TH Deaths: 60
Myanmar Cases: 111,900 (+1,233)
Myanmar Deaths: 2,346 (+27)
· New York Gov. Cuomo warns a January economic shutdown is possible as Covid cases soar to springtime records
· Biden expected to get coronavirus vaccination early next week
President-elect Joe Biden is expected to get his first Covid-19 vaccination early next week, CNN has learned, and plans to get his shot in public.
"I don't want to get ahead of the line, but I want to make sure we demonstrate to the American people that it is safe to take," Biden told reporters Wednesday in Wilmington, Delaware.
"When I do it, I'll do it publicly, so you can all witness my getting it done," the President-elect said.
People familiar with the plans say Biden is likely to get his shot next week. The delay has not been borne out of hesitation, aides say, but rather logistics of administering the shot in a public setting.
· Fed commits to keep buying bonds until the economy gets back to full employment
The Federal Reserve on Wednesday made a key adjustment to its efforts to support the economy, while upgrading its outlook for growth.
As expected, the Fed held benchmark interest rates near zero following the conclusion of its two-day meeting.
FED ECONOMIC PROJECTIONS
Federal Reserve joins global group focused on fighting climate change
· Staring Down Deadline, Congress Nears $900 Billion Stimulus Deal
The emerging compromise would provide emergency stimulus payments, jobless aid and rental assistance, extending help to businesses and funding the distribution of a vaccine. But more is likely to be needed.
While the agreement was not yet final, Republicans and Democrats alike signaled that they were ready to coalesce around the main elements, marking an extraordinary shift from just weeks ago, when both sides were issuing ultimatums and refusing to budge from long-held positions.
The momentum indicated that relief could soon be on its way for individuals and businesses who have waited for months as economists have clamored for another robust infusion of federal aid, warning that Congress’s failure to act could do long-lasting damage.
“We’re making good progress,” said Senator Chuck Schumer of New York, the Democratic leader, in a brief interview on Wednesday afternoon as staff exchanged offers and counteroffers. “No one gets everything they want, but we’re feeling pretty good.”
· U.S. retail sales decline further as Covid, lack of additional fiscal stimulus weigh
U.S. retail sales fell more than expected in November, likely weighed down by raging new Covid-19 infections and decreasing household income, adding to growing signs of a slowdown in the economy’s recovery from the pandemic recession.
The second straight monthly decline in retail sales reported by the Commerce Department on Wednesday could nudge Congress to agree on another fiscal stimulus package. News of the weak start to the holiday shopping season came as Federal Reserve officials were wrapping up a two-day policy meeting.
Retail sales dropped 1.1% last month, with receipts declining almost across the board. Data for October was revised down to show sales slipping 0.1% instead of rising 0.3% as previously reported, adding a sting to the report. October’s dip was the first since April, when stringent measures to control the first wave of coronavirus cases crippled the economy.
The plunge in sales last month was led by motor vehicles, with receipts at auto dealerships tumbling 1.7% after being unchanged in October. Receipts at clothing stores plummeted 6.8%. Consumers also cut back on eating and drinking out. Sales at restaurants and bars dropped 4.0%.
Sales at electronics and appliance stores fell 3.5% and receipts at furniture stores declined 1.1%. There were also decreases in sales at sporting goods, hobby, musical instrument and book stores. But receipts at food and beverage stores rose as did those at building material stores.
Online and mail-order retail sales rose a modest 0.2%.
· U.S. trade czar Lighthizer’s advice for Biden on China: ‘Hold their feet to the fire’
President-elect Joe Biden should keep pressing China to stick to the “Phase 1” trade deal, which Beijing has done a “reasonably good job” implementing parts of, using tariffs as leverage, U.S. Trade Representative Robert Lighthizer told Reuters.
Speaking late on Tuesday in a rare interview, Lighthizer defended the Trump administration’s record in shredding the status quo on trade and imposing unilateral tariffs on $370 billion worth of Chinese goods.
· Bank of England set to wait for end to Brexit stand-off
The Bank of England is expected to refrain from yet more stimulus on Thursday as it waits to see if a possible no-deal Brexit in two weeks’ time deepens the problems already facing Britain’s coronavirus-damaged economy.
London and Brussels are still trying to avoid the shock of import tariffs on trade from Jan. 1, so the BoE looks set to leave its bond-buying programme at 895 billion pounds ($1.2 trillion), having ramped it up by 150 billion pounds last month.
That should provide enough fire-power until late 2021, and the BoE’s Monetary Policy Committee is expected to detail how front-loaded its new bond-buying will be.
The MPC is also likely to keep its benchmark interest rate at a historic low of 0.1% at 1200 GMT.
“We continue to expect a (Brexit) deal will be done,” JP Morgan economist Allan Monks said. “But the main focus from the MPC this week will be any guidance it chooses to offer about how it would react to a no-deal.”
Last month, the BoE said it was “ready to take whatever additional action is necessary to achieve its remit”.
· Britain's retail industry demands probe of disruption at ports
Britain’s retailers and food manufacturers have called on lawmakers to urgently investigate ongoing disruption at UK ports, warning that delays were hurting their plans to build stocks ahead of Christmas and the Dec. 31 end of the Brexit transition period.
The British Retail Consortium (BRC) and the Food and Drink Federation (FDF) said on Thursday they had written to Lilian Greenwood, chair of parliament’s Commons Transport Select Committee, and Angus Brendan MacNeil, chair of the International Trade Committee, requesting an urgent inquiry into ongoing disruption at ports and across the shipping market.
The BRC and FDF said the impact of the coronavirus pandemic on global shipping schedules and the shipping workforce, along with a shortage of empty containers, had created significant disruption at many of the UK’s key ports, such as Felixstowe and Southampton, in the crucial run-up to Christmas.
· Australia will formally ask the World Trade Organization to mediate barley dispute with China
· China regulator says should consider digital data tax for tech firms
China should consider imposing a digital tax on technology companies that hold copious amounts of user data, a securities watchdog official was quoted as saying by Beijing News, in the latest sign of widening government scrutiny of the sector.
“Some third-party platform-like enterprises hold a large amount of users data, just like holding precious mineral mines,” the government-back newspaper cited Yao Qian, science and technology supervision bureau chief at the China Securities Regulatory Commission (CSRC), saying at a forum held in Beijing.
Yao said the value of the platform-like enterprises was created by their users, and users are supposed to share the profits with those enterprises.
Reference: CNBC, Rueters, The New York Times, CNN, Worldometers
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