(Bloomberg) – Gold stabilized after a two-day gain as investors awaited testimony from Federal Reserve Chairman Jerome Powell and weighed in on the prospect of a U.S. stimulus package coming closer to evidence.
Powell’s half-yearly report in the Senate Banking Committee on Tuesday and Wednesday in the House Financial Services panel will be monitored for further policy guidance and his assessment of the recovery. Meanwhile, the House Budget Committee advanced President Joe Biden’s $ 1.9 trillion pandemic relief law and paved the way for it to pass the lower chamber by the end of this week.
Powell’s Dove comments should support gold, “but what’s more important to Bullion is if Powell maintains a common theme from Fed speakers in recent weeks that continues to push back on any need to open a debate on the appropriate timing for a tering of the Fed’s bond buying program, “HSBC Holdings Plc analyst James Steel wrote in a note.
“Gold’s steepest decline this year occurred in January on premature tearing from a few Fed speakers,” Steel said.
Bullion has returned from a decline last week as traders focus on rising inflation expectations and the potentially massive economic stimulus. Holdings in exchange-traded funds with bullion have had a constant outflow, with SPDR Gold Shares, the largest ETF, on Monday recording the largest decline since November.
Spot gold was stable at $ 1,809.08 an ounce at 12.58 in London after rising 1.9% over the previous two days. Silver, platinum and palladium all fell. The Bloomberg Dollar Spot Index was slightly changed.
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