Gold rises as US stimulus hopes bolster appeal

Jan 25: Gold prices rose on Monday, recovering from a sharp decline in the previous session, as investors hoped that a massive economic stimulus would be passed soon in the United States to revive the world’s largest economy.

FUNDAMENTALS

* Spot gold rose 0.3% to $ 1,858.57 per ounce by 0039 GMT, having slipped 0.9% in the previous session. U.S. gold futures were little changed at $ 1,856.60.

* The Joe Biden administration and Democratic and Republican lawmakers discussing a new $ 1.9 trillion in coronavirus relief agreed on Sunday that the most important priority should be producing and efficiently distributing a vaccine.

* The U.S. Senate Finance Committee on Friday unanimously approved Janet Yellen’s nomination as the first woman Treasury secretary, indicating that she will easily win full Senate approval on Monday.

* Yellen at her confirmation hearing last week urged lawmakers for large coronavirus relief spending, adding that the benefits outweigh the expenses of a higher debt burden.

* Gold is considered a hedge against inflation, likely from widespread stimulus.

* Global coronavirus cases rose to more than 98 million as countries continued to work on the pace of vaccinations.

* The U.S. Federal Reserve policy meeting is due on Jan. 26-27.

* Demand for physical gold picked up last week as the approaching Chinese New Year encouraged buyers in China and Singapore.

* Speculators reduced their bullish positions in COMEX gold and silver contracts in the week to Jan. 19, data showed.

* Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust , eased 0.07% to 1,173.25 tonnes on Friday.

* Silver gained 0.9% to $ 25.61 an ounce, platinum rose 0.6% to $ 1,105.06, and palladium added 0.1% to $ 2,355.83.

DATA/EVENTS (GMT) 0900 Germany Ifo Business Climate New Jan 0900 Germany Ifo Curr Conditions New Jan 0900 Germany Ifo Expectations New Jan 1000 EU Consumer Confid. Final Jan