Gold Gains as US Dollar Weakens – Traders Look For Rollout of More Stimulus
Gold prices are climbing higher in early trading on Tuesday on the back of a weaker US dollar even as rising hopes for more fiscal stimulus
Gold prices are climbing higher in early trading on Tuesday on the back of a weaker US dollar even as rising hopes for more fiscal stimulus measures to be announced in the US support its safe haven appeal in markets. At the time of writing, GOLD is trading at a little above $1,839.
During the previous session, the dollar slipped to the lowest levels seen in a week, making gold more affordable for holders of other currencies and increasing its demand as a result. Recent weak data releases from the US have markets worried that economic recovery could take longer than previously hoped for, which have dented the greenback’s recent rally and turned it bearish.
Traders now turn their focus towards developments surrounding President Biden’s $1.9 trillion stimulus package, with Democrats approving a budget outline that can fast-track its passing even without the support of Republican lawmakers. Over the weekend, US Treasury Secretary Janet Yellen also spoke in favor of more stimulus, maintaining that it could help US employment rebound to pre-pandemic levels by 2022.
While hopes for further stimulus are supporting gold’s bullishness, gains in the precious metal remain limited by a strengthening in US Treasury yields. Higher treasury yields increase the opportunity cost of holding bullion, putting pressure on its safe haven status.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Related Articles
Comments
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals