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PRECIOUS-Gold rises on inflation bets ahead of Biden unveiling stimulus

Published 14/01/2021, 12:21 pm
© Reuters.
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Jan 14 (Reuters) - Gold prices rose on Thursday ahead of U.S. President-elect Joe Biden's coronavirus stimulus proposal, while data showing U.S. consumer prices rose solidly in December bolstered bets of higher inflation.

FUNDAMENTALS

* Spot gold XAU= rose 0.3% to $1,848.07 per ounce by 0054 GMT, while U.S. gold futures GCv1 eased 0.4% to $1,847.70.

* Biden will press Congress on Thursday to deliver immediate pandemic "rescue" efforts before turning to broader "recovery" measures like healthcare and infrastructure, the incoming administration's top economic adviser said on Wednesday. Biden last week estimated his economic relief plan would cost "trillions" of dollars. U.S. consumer prices increased solidly in December and inflation could temporarily accelerate this year as the government provides more money to stimulate the economy. Gold is considered a hedge against inflation.

* U.S. economic activity increased modestly in recent weeks and a growing number of the Federal Reserve's districts saw a drop in employment as a surge in coronavirus cases led to more shutdowns of businesses, the U.S. central bank said on Wednesday. The U.S. House of Representatives passed a single article of impeachment accusing President Donald Trump of "incitement of insurrection", making him the first president in U.S. history to be impeached twice. Exchange traded funds (ETFs) storing gold for investors shrank for a second month in December, but nevertheless grew more than ever before in 2020 thanks to massive stockpiling earlier in the coronavirus outbreak. Holdings of the world's largest gold-backed exchange-traded fund SPDR Gold Trust GLD fell 0.9% to 1,171.21 tonnes on Wednesday. Silver XAG= rose 0.8% to $25.34 an ounce. Platinum XPT= climbed 0.4% to $1,098.77, while palladium XPD= eased 0.4% to $2,375.45. DATA/EVENTS (GMT) 0630 India WPI Inflation YY

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