Early on Monday, gold is trading bullish, enjoying support from a weakening US dollar and rising hopes for more stimulus measures in the US to offset the economic damage from the coronavirus pandemic. At the time of writing, GOLD is trading at a little above $1,873.
Late last week, US Treasury Secretary Steven Mnuchin had stated that Republican and Democrat leaders would continue their negotiations towards working out the next round of fiscal stimulus measures. His statements came after he drew flak for his announcement ending several emergency lending programs rolled out by the Fed.
Gold prices also received a boost from a weakness in the US dollar, as markets worry about a surge in fresh coronavirus cases after the Thanksgiving holiday in the US. The US dollar shares a negative correlation with the yellow metal, and whenever it weakens, it becomes more affordable for holders of other currencies to purchase gold.
Gains in gold, however, remain limited owing to a positive sentiment in markets surrounding the possible rollout of vaccines to combat COVID-19. Several news reports suggest that the US FDA and other regulatory authorities worldwide could expedite the process of approving the vaccine to combat the pandemic’s spread quickly.