Gold slips as sturdy dollar and shares dent appeal
· Gold prices gave up gains of 1% on Monday as a stronger dollar and increased risk appetite among investors eclipsed support from a retreat in U.S. Treasury yields.
· Spot gold was down 0.6% at $1,723.30 an ounce by 02:02 p.m. ET (1902 GMT) and U.S. gold futures settled 0.3% down at $1,723.
· “Vision of economic recovery, the dollar rebounding off recent lows, equity markets doing well ... in this environment there’s been a bit of a lesser demand for gold,” said David Meger, director of metals trading at High Ridge Futures.
“But on the other side of that coin, we are seeing an additional $1.9 trillion stimulus being injected into the economy and we could potentially see an inflationary environment down the road, in which gold has a tendency to fare quite well.”
· The dollar index jumped to a three-week high, while optimism over the economic stimulus and promising updates on COVID-19 vaccines lifted risk sentiment in wider financial markets.
· The U.S. House of Representatives approved President Joe Biden’s $1.9 trillion coronavirus relief bill early on Saturday, sending it to the Senate for consideration.
· Although gold may be supported by the stimulus in the medium term, gold will face some “headwinds”, said StoneX analyst Rhona O’Connell.
· While gold is considered a hedge against inflation, recent higher bond yields have threatened that status because they translate into a higher opportunity cost of holding bullion, which pays no return.
· Offering some respite to gold, benchmark 10-year U.S. Treasury yields eased from a one-year high.
· On the technical front, the psychological $1,700 level is very significant, while the $1,760-$1,765 range is an important hurdle for gold to rise further, said Stephen Innes, chief global market strategist at financial services firm Axi.
· In other precious metals, silver slipped 0.5% to $26.50 an ounce, palladium climbed 1.6% to $2,354.40 and platinum was steady at $1,188.30.
· Goldman says investors shouldn’t worry about interest rates at these levels
· Fed policy changes could be coming in response to bond market turmoil, economists say
While the Federal Reserve may not raise its benchmark interest rate for years, there are growing expectations it may tweak policy soon to address some of the recent tumult in the bond market.
The moves could happen as soon as the upcoming March 16-17 Federal Open Market Committee meeting, according to investors and economists who are watching recent action closely and expect the central bank to address some distortions that have occurred.
· Senate to debate on COVID-19 bill this week after Democrats backpedal on minimum wage
The U.S. Senate will start debating President Joe Biden’s $1.9 trillion coronavirus relief bill this week, Senate Majority Leader Chuck Schumer said on Monday after Democrats backed down from an effort to raise the minimum wage to $15 as part of it.
The backpedaling did not end hopes of addressing the minimum wage issue in Congress. Democrats and some Republicans have voiced support for the idea of raising the federal minimum wage, now at $7.25 an hour, for the first time since 2009, although they disagree on how much.
Republican Senators Mitt Romney and Tom Cotton last week proposed an increase to $10 per hour, but said employers should verify the wage is going to workers who are legally in the United States.
But two Senate Democrats acknowledged that passing an increase would be challenging in the 50-50 chamber.
Senate debate on the COVID-19 bill could begin as early as Wednesday, a Senate Democratic aide said.
Democrats aim to pass the legislation in the Senate trough a maneuver known as “reconciliation,” which would allow the bill to pass with a simple majority rather than the 60 votes normally required by that chamber’s rules.
· U.S. factory activity scales three-year high, price pressures building
U.S. manufacturing activity increased to a three-year high in February amid a surge in new orders, but factories continued to face higher costs for raw materials and other inputs amid labor shortages at suppliers as the pandemic drags on.
The acceleration reported by the Institute for Supply Management (ISM) on Monday was despite a global semiconductor chip shortage, which has hurt production at automobile plants. Other data showed construction spending surged to a record high in January, boosted by strong private and public outlays.
The ISM said its index of national factory activity rebounded to a reading of 60.8 last month from 58.7 in January. That was the highest level since February 2018.
· Global COVID-19 infections up for first time in seven weeks, WHO says
· CORONAVIRUS UPDATES:
Global Cases: 114.97 (+280,860)
Global Deaths: 2.54M (+6,383)
COVID-19 infections are still rising in 60 countries.
U.S. Cases: 29.31M (+49,094)
U.S. Deaths: 527,150 (+1,363)
No. 2
India Cases: 11.12M (+10,930)
India Deaths: 157,257(+62)
No.3
Brazil Cases: 10.58M (+38,349)
Brazil Deaths: 255,836 (+818)
No.4
Russia Cases: 4.25M (+11,571)
Russia Deaths: 86,455 (+333)
No.5
UK Cases: 4.18M (+5,455)
No. 38
Japan Cases: 432,773 (+1,033)
Japan Deaths: 7,887 (+27)
No.114
Thailand Cases: 26,031 (+80)
Thailand Deaths: 83
· Vaccination
So far 107 countries have begun vaccinating people for the coronavirus and have administered at least 244,200,000 doses of the vaccine.
· New U.S. COVID-19 cases hit plateau after steep drops
The United States reported a 3% decline in new cases of COVID-19 last week, a much smaller drop than in the previous six weeks, and health officials warned that progress against the global pandemic was stalling.
· U.S. to give Americans COVID-19 vaccines before discussing sharing with Mexico: White House
· J&J COVID-19 vaccine shipping to U.S., but new deliveries hinge on regulators
Johnson & Johnson will ship nearly 4 million doses of its newly authorized single-dose COVID-19 vaccine around the United States this week, but a top executive said on Monday that the next round of deliveries is contingent on regulatory approvals at a new plant.
· Johnson & Johnson waiting on new plant approval to ship high volumes of vaccine: executive
· Novavax COVID-19 shot could be cleared for U.S. use by May: CEO
Novavax Inc’s chief executive said on Monday that its COVID-19 vaccine could be cleared for use in the United States as soon as May if U.S. regulators authorize it based on data from the company’s British trial, which could be completed “in the coming weeks.”
· Czechs tighten COVID lockdown, seek more tests for factory workers
· UK hunts for missing person infected with Covid variant first detected in Brazil
· EU to propose digital vaccination passport in March, von der Leyen says
· Biden's trade rep pick says she will fight Chinese trade barriers, including censorship
President Joe Biden’s U.S. trade representative nominee, Katherine Tai, said on Monday she would work to fight a range of “unfair” Chinese trade and economic practices and would seek to treat Chinese censorship as a trade barrier.
· China seems to be living up to trade deal pledges, Biden’s Agriculture secretary says
· U.S. faces 'unprecedented assault on democracy,' White House says, backing election reform bill
· Texas power crisis deepens as more companies skip payments due to grid operator
Texas energy companies failed to pay another $345 million for electricity and other services incurred during last month’s cold snap, the operator of the state’s grid said on Monday.
· Oil executives expect crude demand to climb, even as renewables are in vogue
· Myanmar killings are an escalation, further action being readied: White House
Recent killings of protesters in Myanmar represent an escalation of the situation there, White House press secretary Jen Psaki said on Monday, noting that the Biden administration was preparing further costs on those responsible for the military coup.
· U.S. failure to sanction prince for Khashoggi killing 'dangerous': U.N. expert
· Hang Seng Indexes shakes up Hong Kong benchmark, aims to include 100 companies
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