Gold Steady as Investors Look to Washington for Stimulus Deal

Gold was steady after signs of progress in U.S. stimulus talks aimed at reaching a deal ahead of the looming presidential election.

Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are narrowing their differences on a stimulus deal, a Pelosi aide said Monday. Investors are weighing the chances of a resolution to stimulus talks before the Nov. 3 election. U.S. equity futures advanced and the dollar steadied as optimism about the package spurred risk appetite.

Gold has held in a narrow range during October amid the fraught Washington talks, a contentious U.S. election season and uncertainty around the global economys recovery from the coronavirus pandemic.

“Long-term investors have shifted focus on what the November election outcome means for stimulus later, with a Democrat victory seen boosting golds sentiment with a very large stimulus package,” Phillip Futures Pte. wrote in an emailed note.

Global coronavirus cases exceeded 40 million, with the pandemic showing no signs of slowing. Moderna CEO Stéphane Bancel said the U.S. government could authorize emergency use of its Covid-19 vaccine in December if it gets positive interim results in November from a large clinical trial, Wall Street Journal reported.

In the short term, “with no new definite drivers with enough mojo that would be able to propel gold to new highs beyond recent record levels, prices can expected to consolidate or fall,” Phillip Futures said.

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Spot gold little changed at $1,902.82 an ounce by 7:37 a.m. in London. Silver rose 0.5% and palladium +0.4, while platinum steady.

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— With assistance by Martin Ritchie, and Swansy Afonso