Gold Makes Gains After Steep Decline as Focus Turns to US Stimulus
Arslan Butt • 1 min read
Early on Tuesday, gold is trading somewhat bullish after seeing a sharp decline in the previous session, as traders pin their hopes on the next round of fiscal stimulus measures in the US. At the time of writing, GOLD is trading at a little above $1,880.
Gold prices saw a sharp decline of over 5% during the previous session over optimistic reports about Pfizer’s COVID-19 vaccine having an efficiency of over 90%. The news of a possible vaccine to combat the coronavirus pandemic raised the risk sentiment in global financial markets and dented the safe haven appeal of the precious metal.
However, in early trading on Tuesday, after the initial optimism surrounding a possible vaccine receded, traders turned their focus towards a likely stimulus package being announced soon in the US. Biden’s recent victory in the presidential election has raised hopes for a larger coronavirus relief package, which has boosted gold prices in turn.
In addition, Trump refuses to concede defeat to Biden, mounting legal action against vote counting in states where he lost, adding an element of uncertainty to the political situation in the US. On Monday, Trump’s campaign filed a lawsuit to block government officials from confirming Biden’s victory in Pennsylvania.