· Gold rose to a two-month high on Monday, bolstered by a retreat in the dollar and persistent inflation concerns after key central banks indicated interest rates would remain low in the near term.
· Spot gold was up for the third straight session, rising 0.5% to $1,825.64 per ounce by 1:40 p.m. ET (1740 GMT), the highest since Sept. 7.
· U.S. gold futures settled 0.6% higher at $1,828.
· Boosting gold’s appeal for those holding other currencies, the dollar index eased 0.3%.
· Major central banks are still overall accommodative, and all the cash in the system looking for a home is moving more into the gold and silver market as an inflation hedge, said Jim Wyckoff, senior analyst at Kitco Metals.
· Bullion jumped nearly 2% on Friday after the U.S. Federal Reserve and the Bank of England held off on any interest rate hikes.
· Inflation-cushion gold has been benefiting from an ultra-low interest rate environment to spur growth during the pandemic, since that translates into reduced opportunity cost of holding the non-yielding bullion.
However, worries that central banks will start tightening policy to combat rising prices have kept investors on the lookout for economic data.
· Tightness in the labor market combined with dislocation in global supply chains could result in another high reading for U.S. consumer prices due on Wednesday.
· “Wednesday’s data is likely to favor gold as inflation could show the fastest rise since 1990,” likely triggering buying interest in bullion, said Sugandha Sachdeva, vice president of commodity & currency research at Religare Broking.
· Meanwhile, the United Arab Emirates, one of the world’s biggest bullion trade hubs, will require all gold refineries to undergo annual audits to ensure their suppliers are responsible, in an effort to combat illicit trading.
· Elsewhere, spot silver rose 1.2% to $24.45 per ounce, platinum climbed 2.3% to $1,057.75, and palladium gained 1.7% to $2,069.10.
· Bitcoin hits new record as crypto market cap exceeds $3 tln
Bitcoin and ether made record peaks in the Asia session on Tuesday as enthusiasm for cryptocurrency adoption and fears about inflation leant support to the asset class.
Bitcoin rose as far as $67,700 and ether , the second-biggest cryptocurrency by market value, hit $4,800. Both have more than doubled since June and added nearly 70% against the dollar since the start of October.
· Dollar slips from 15-month highs as investors eye Fed, data
· U.S. consumers' income and spending expectations reach 8-year high
· Inflation tops pandemic as investor concern -Fed report
Concerns over higher inflation and tighter monetary policy have become the top concern for market participants, pushing aside the COVID-19 pandemic, the Federal Reserve said on Monday in its latest report on financial stability.
At the same time, the semiannual report also flagged the growing use of stablecoins and "so-called meme stocks" as issues that merit attention and pose new types of potential risks to the financial system.
The focus on inflation marks a return, in a sense, to more normal concerns as the pandemic eases, and the Fed's report largely portrayed financial risks as well-contained.
· Fed officials turn focus to rate debate, eye on jobs, inflation
At the center of the debate will be an assessment of how many more jobs the economy can add, and how much longer high inflation can be tolerated, given that the rate of price increases is already pushing beyond comfortable levels.
Fed Vice Chair Richard Clarida said that while the U.S. central bank remains “a ways away from considering raising interest rates,” if his current outlook for the economy proves correct, then the “necessary conditions for raising the target range for the federal funds rate will have been met by year-end 2022.”
In separate remarks St. Louis Federal Reserve Bank President James Bullard repeated his outlook that the Fed will need to raise rates twice next year - with U.S. job markets already so tight it is adding to inflation through growing wage and compensation costs.
Fed's Bowman sees risks in housing market, flags inflation pressure
Fed's Harker says he does not expect rates to rise until taper is complete
Fed's Evans: inflation high but still no rate hike until 2023
· Fed’s Powell: Pandemic recession has particularly hurt women
Federal Reserve Chair Jerome Powell expressed concern Monday that the pandemic recession has had an unusually harmful economic effect on women, who have been forced to shoulder additional responsibilities for childcare, forcing many of them to leave work.
· Global stocks at new highs, crude rises on global growth outlook
World shares hit new highs on Monday as investors welcomed the passage of a U.S. infrastructure spending bill, while crude oil gained on the outlook for energy demand in an expansive global economy.
· Investors are piling into infrastructure stocks after House passes Biden plan
· S&P 500 closes above 4,700 for the first time as infrastructure stocks rally
· Yields higher after infrastructure deal, soft demand for 3-year notes
Traders sent most U.S. Treasury yields higher on Monday after Congress passed a $1 trillion infrastructure bill and demand was soft for three-year notes at auction.
The benchmark 10-year yield was up 4.5 basis points at 1.4984%.
· Oil gains after U.S. infrastructure bill, plans to address prices
· Biden, top team to crisscross U.S. in victory tour for $1 trillion infrastructure bill
President Joe Biden and top officials in his Cabinet are hitting the road to promote the $1 trillion infrastructure bill passed in Congress last week, as they explain when and where Americans can expect to see some of the funds in their own communities.
· EU inflation to subside, debt must fall but without hurting growth -ministers
European Union finance ministers agreed on Monday that the current surge in consumer prices would subside next year and that high public debt created by the pandemic had to be reduced, but in a way that would not hurt economic growth.
Inflation rose 4.1% year-on-year last month in the 19 countries sharing the euro, up from 3.4% in September and the ministers are starting to worry that the rise might fuel stronger wage growth, creating an inflationary spiral.
· BoE will act on rates if inflation risks grow, Bailey says
The Bank of England will have to act if it sees expectations of higher inflation pushing up wages, BoE Governor Andrew Bailey said, echoing his recent message about the direction of monetary policy which last week led to a jolt in financial markets.
· French economy on course for 0.75% fourth quarter growth
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