The US President-elect Joe Biden yesterday unveiled an ambitious and expansive stimulus plan as he prepares to assume the presidential mantle next week. The former vice president’s economic rescue package amounts to more than £1.37 trillion ($1.9 trillion) in aid, with huge sums allocated to beat back coronavirus and increase unemployment support for millions of out of work Americans.
The wide-ranging package coincided with news that unemployment claims have once again spiked, raising fears that the economy is sliding back into the doldrums; something that is supportive of stronger gold prices.
In addition, the Federal Reserve Chairman, Jerome Powell also issued remarks coinciding with the economic stimulus package, confirming that the Fed would maintain its doveish policy, given how far away its economic health and inflation goals continue to be.
For gold, these announcements offer additional fuel for the bull run. In the immediate aftermath of President-elect Biden’s package being unveiled, the precious metal gained 0.2% on the day’s trading, taking it to £1,338 ($1,850).