Gold prices are climbing higher in early trading on Thursday as its safe haven appeal strengthened over emerging reports about a new strain of coronavirus that is resistant to current vaccines. At the time of writing, GOLD is trading at a little above $1,714.

In addition, President Biden’s plans for additional stimulus in the form of investment in infrastructure and job creating is also lending support to the yellow metal for now. Expectations are that the next round of spending worth over $2 trillion could further heat up inflation in the US, and gold – considered as a hedge against inflation, is enjoying bullish moves as a result.

However, gains in the precious metal remain limited by rising hopes that the global economy could post a swift recovery once the coronavirus pandemic is brought under control. The WTO recently revised its global goods trade’s growth forecast higher, aiding these hopes and keeping a lid on gold prices.

Meanwhile, Biden’s plans further boost the prospects of a rapid recovery in the US economy, which are keeping US Treasury yields and the dollar strong and exerting downward pressure on the yellow metal prices. Recent economic data releases from the US, China and Japan are also bolstering market’s confidence in rapid economic recovery around the world, turning investors away from the safety of gold and towards riskier instruments, especially equity markets.