Gold held a decline on a stronger dollar and the currency’s outlook, while investors assessed the timeline for the U.S. stimulus package.
Former Federal Reserve Chair Janet Yellen is expected to affirm the U.S.’s commitment to market-determined exchange rates when she testifies on Capitol Hill Tuesday, and she will make clear the U.S. doesn’t seek a weaker dollar for competitive advantage, according to a report from the Wall Street Journal, citing people familiar with the preparation. A gauge of the greenback has climbed in the past two weeks.
Yellen’s confirmation hearing as Treasury Secretary is scheduled for Jan. 19 in front of the Senate Finance Committee, the day before President-elect Joe Biden is sworn into office.
Bullion has dropped almost 4% this year as U.S. Treasury yields and the dollar advanced. Still, the metal is staying above $1,800 an ounce and is expected to receive support from massive stimulus packages from central banks and governments. Biden is pushing for quick congressional action on his economic relief plan, but he risks slowing it down with a federal minimum-wage increase that Republicans and business groups have long fought.
“A stronger U.S. dollar is proving to be a headwind for precious metals prices despite the massive trillion dollar stimulus proposals to alleviate the ill effects of Covid-19,” said Avtar Sandu, a senior manager for commodities at Phillip Futures Pte.
Spot gold was little changed at $1,828.22 an ounce by 12:43 p.m. in Singapore after earlier falling as much as 1.3%. Prices ended last week 1.1% lower. Silver and platinum rose, while palladium was steady.
Meanwhile, as the U.S. death toll from Covid-19 neared 400,000, Anthony Fauci, the nation’s top infectious disease expert, said that Biden’s promise of delivering 100 million vaccine doses in 100 days is “absolutely a doable thing.” Vaccinations in the U.S. began Dec. 14 with health-care workers, and so far 13.7 million shots have been given, according to a state-by-state tally by Bloomberg News and data from the Centers for Disease Control and Prevention.