Gold Prices Rose Due To The New Incentive Package

Gold Prices Rose Due To The New Incentive Package Gold prices rose due to the new incentive package. With the recent news flow regarding the stimulus package that came to the agenda in the USA, gold prices started to increase. Gold prices picked up as investors' expectations that they would agree on the incentive package, which has been discussed for a long time in the US, outweighed the vaccine developments. Senate Majority Leader Mitch McConnell distributed a revision of his plan, which included a smaller fiscal stimulus package to Republicans, while Speaker of the House of Representatives Nancy Pelosi presented the new stimulus package to Treasury Secretary Mnuchin. Fed Chairman Jerome Powell and US Treasury Secretary Steven Mnuchin agree that with the increase in coronavirus cases, another stimulus package is needed for the economy to continue to normalize in the coming months. Gold has had its worst month since 2016, with advances in the coronavirus vaccine and increased risk appetite. Expectations for an extra stimulus package prompted a rally on Tuesday, while Treasury bills rose and the dollar broke the lowest level in the past two years.   Overse-Chinese Banking Group economist Howie Lee said: “Factors such as monetary and fiscal expansion, record low bond yields, and real interest rates that have caused gold to rise this year have not changed yet. Cases of coronavirus are on the rise in the US, and regardless of when the vaccine will arrive, another financial stimulus package will be needed. Gold fell but did not die.” Gold prices rose 2.2 percent on Tuesday, then fell 0.32 percent at 07:58 BST to 1809.50 per ounce. Silver lost 1.4 percent, while platinum fell 1.3 percent. The Bloomberg Dollar Spot Index changed little after dropping 0.7 percent on Tuesday.