Gold Weakens as US Stimulus May Take Longer to Roll Out

Gold is trading weaker on Thursday after three consecutive days of gains, as markets remain uncertain about whether the next round of fiscal stimulus measures in the US would be finalized soon. At the time of writing, GOLD is trading at a little above $1,914.

Even though both sides confirmed that discussions were making progress, US President Donald Trump and House Speaker Nancy Pelosi have raised concerned about whether it can be passed before the November 3 elections. The delay in the next round of stimulus has weakened the safe haven appeal of gold and sent prices lower.

Gold has also come under pressure as the US dollar holds steady against major rivals, as it shares a negative correlation with the reserve currency. Whenever the dollar trades strong, it makes gold more expensive for holders of other currencies, keeping its demand in check.

In addition, possible hopes for Britain and EU to make progress towards finalizing the post-Brexit trade deal soon are also reducing the appeal of gold in global markets. Both sides are expected to continue their discussions later today in hopes for working out a trade deal that will come into effect at the beginning of 2021, once the transition period for Brexit comes to an end.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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