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·         Gold prices fell on Tuesday as risk appetite improved after U.S. Federal Reserve officials calmed down inflation worries among investors, although the metal’s losses were limited by a subdued dollar and bond yields.

 

·         Spot gold slid 0.3% to $1,876.24 per ounce by 0250 GMT. U.S. gold futures fell 0.4% to $1,876.30 per ounce.

 

·         “The sentiment pendulum swung back to the bullish side overnight, after a procession of Federal Reserve officials talked down inflation risks. That led to a broad-based recovery in equity markets and has seen gold’s momentum temporarily halted,” OANDA senior market analyst Jeffrey Halley said.

 

·         “Gold’s critical support level lies around $1,845 an ounce, its 200-day moving average. As long as it holds above there, the uptrend remains intact.”

 

·         St. Louis Fed President James Bullard said he expects the inflation rate to be above 2% both this year and the next but several Fed officials, including Bullard, continued to support the central bank’s policy in separate remarks.

 

·         Asian shares climbed in early trade, tracking a Wall Street rally overnight, as investors tempered fears about inflation-driven rate hikes.

 

·         Meanwhile, Bitcoin jumped more than 10% during a surge in cryptocurrencies on Monday, regaining some ground lost due to a sell-off over the weekend.

 

·         Offering some respite to gold, the dollar was languishing near four-month lows against major currencies, while U.S. Treasury long-dated yields fell to two-week lows.

 

·         Lower bond yields reduce the opportunity cost of holding non-interest bearing gold.

 

·         Holding of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.3% to 1046.12 tonnes on Monday from 1042.92 tonnes on Friday.

 

·         Elsewhere, palladium rose 0.5% to $2,741.19 per ounce, after falling to a one-month low on Monday.

 

·         Silver fell 0.7% at $27.60 per ounce, while platinum was steady at $1,174.

 

​​·         Ether has ‘a better shot’ at becoming a commodity than bitcoin, says NYU professor

Aswath Damodaran of NYU Stern School of Business explains why ether may have a “stronger upside story” than bitcoin.​

·         Fed's George says doesn't dismiss risk of inflation surge

Kansas City Federal Reserve President Esther George on Monday cautioned against a “rigid” approach to monetary policy in a post-pandemic era that may involve different inflation and employment dynamics than ones seen in the last few years and worked into the Fed’s current policy framework.

That new framework, emphasizing job generation and faith that the forces that kept inflation low in recent years will continue to do so, has led the Fed to pledge to continue buying $120 billion a month in bonds until the job market improves and to leave interest rates near zero for even longer even as prices begin to rise.

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·         Britain probing AstraZeneca-Alexion deal over competition concerns

Britain's competition regulator said on Tuesday it has started a probe into AstraZeneca's (AZN.L) $39 billion takeover of U.S. drugmaker Alexion (ALXN.O) for possibly reducing competition in the UK market or elsewhere.

 

·         Britain preparing for rise in unemployment, work minister says

Britain is preparing for a rise in unemployment after a government furlough scheme initially helped stave off job losses from the COVID-19 pandemic, work and pensions minister Therese Coffey said on Tuesday.

 

·         Coronavirus hit on German economy bigger than expected in first quarter

The German economy shrank by a bigger than expected 1.8% on the quarter in the first three months of the year as coronavirus curbs crushed private consumption in Europe’s largest economy, data showed on Tuesday.

·         Russia’s power over Belarus is in the spotlight after plane ‘hijacking’ incident

As global leaders expressed outrage at Belarus’ “hijacking” of a Ryanair plane and the detention of an opposition activist, Russia was notable for its vociferous defense of the country. Now, analysts are saying Moscow stands to benefit from Belarus’ further estrangement from the West.

Belarus on Sunday ordered a Ryanair flight carrying prominent Belarusian opposition activist Roman Protasevich to divert to its capital Minsk, whereupon the activist was detained. Russia described the uproar in the U.S. and Europe as “shocking” and accused the West of having double standards.

·         Manufacturing could return to China, as Covid cases spike in India and Vietnam

The Covid-19 resurgence in some parts of Asia could lead to a change in fortunes for China, according to an economist.

Previously, the U.S.-China trade war caused companies to move their supply chains out of China, shifting their production and distribution networks for products and services. As a result, countries like Vietnam and India benefited as companies moved to set up shop in their countries.

But the situation appears to be changing, and supply chains could pivot back to China as cases spike in India and Vietnam, according to Zhang Zhiwei, chief economist at Pinpoint Asset Management.​

 

·         Japan's losses from COVID-19 curbs to dwarf Olympics no-go fallout, says economist

Japan stands to lose 1.8 trillion yen ($16 billion) if the Olympics were cancelled, but that would pale in comparison to the economic hit from emergency curbs if the Summer Games turned into a super-spreader event, a top economist estimated.

 

​·         India said to plan COVID-19 economic stimulus package - Bloomberg

India is preparing an economic stimulus package for the sectors worst affected by COVID-19, Bloomberg reported on Tuesday, citing people familiar with the matter.

 

·         Barclays cuts FY 2021-22 growth forecast for India by 80 bps to 9.2%

Barclays on Tuesday cut its full-year 2021-22 economic growth forecast for India by 80 basis points to 9.2%, saying the toll from stringent lockdowns imposed to curb rising COVID-19 infections appeared to be bigger than its earlier expectation.

The devastating second wave of coronavirus infections has forced nearly two-thirds of the country to introduce tough curbs, slowing economic activity and prompting a host of major banks and ratings agencies to cut their economic forecasts.​

·         Singapore sees uneven recovery after Q1 GDP tops forecasts

Singapore's economy expanded more than first thought in the first quarter and the government maintained its growth forecast for the year, but struck a cautious note about recovery due to uncertainties from the COVID-19 pandemic.

Gross domestic product (GDP) grew 1.3% year-on-year in the first quarter, the Ministry of Trade and Industry (MTI) said on Tuesday, higher than the 0.2% growth seen in the government's advance estimate.

 

·         Millions of COVID vaccine doses on way to Taiwan, alert level extended

Millions of COVID-19 vaccine doses are on their way to Taiwan, the health minister said on Tuesday, as he extended virus-related restrictions until the middle of June even though the trend in new infections is falling.

Having spent months keeping the virus at bay with life relatively normal compared with many other places, Taiwan is dealing with a spike in domestic infections, exacerbated by a low vaccination rate of only about 1% of its population.

 

·         Vaccine hesitancy grows ahead of Thailand's mass inoculation rollout

Vaccine hesitancy has risen sharply in Thailand ​O​pinion polls show, just weeks away from the start of a mass inoculation programme and as the country fights its deadliest COVID-19 outbreak.