This is not a paywall.

Register for free to continue reading.

We made a promise to you that we’ll never erect a paywall and we intend to keep that promise. We also want to continually improve your reading experience and you can help us do that by registering with us. It’s quick, easy and will cost you nothing.

Nearly there! Create a password to finish up registering with us:

Please enter your password or get a login link if you’ve forgotten

Open Sesame! Thanks for registering.

Ramaphosa's energy plan Webinar banner

We'd like our readers to start paying for Daily Maverick

More specifically, we'd like those who can afford to pay to start paying. What it comes down to is whether or not you value Daily Maverick. Think of us in terms of your daily cappuccino from your favourite coffee shop. It costs around R35. That’s R1,050 per month on frothy milk. Don’t get us wrong, we’re almost exclusively fuelled by coffee. BUT maybe R200 of that R1,050 could go to the journalism that’s fighting for the country?

We don’t dictate how much we’d like our readers to contribute. After all, how much you value our work is subjective (and frankly, every amount helps). At R200, you get it back in Uber Eats and ride vouchers every month, but that’s just a suggestion. A little less than a week’s worth of cappuccinos.

We can't survive on hope and our own determination. Our country is going to be considerably worse off if we don’t have a strong, sustainable news media. If you’re rejigging your budgets, and it comes to choosing between frothy milk and Daily Maverick, we hope you might reconsider that cappuccino.

We need your help. And we’re not ashamed to ask for it.

Our mission is to Defend Truth. Join Maverick Insider.

Support Daily Maverick→
Payment options

Gold and Copper Climb as Dollar Weakens With Eyes on In...

Business Maverick

Business Maverick

Gold and Copper Climb as Dollar Weakens With Eyes on Inflation

A worker lifts a gold ingot from a cooling bath at the Uralelectromed Copper Refinery, operated by Ural Mining and Metallurgical Co. (UMMC), in Verkhnyaya Pyshma, Russia, on Thursday, July 30, 2020. Gold surged to a fresh record Friday fueled by a weaker dollar and low interest rates. Silver headed for its best month since 1979. Photographer: Andrey Rudakov/Bloomberg
By Bloomberg
20 Jan 2021 0

Gold and copper surged as the dollar weakened amid signs that interests rates may remain low, boosting inflation expectations as Joe Biden begins his first day as U.S. president.

The Bloomberg Dollar Spot index extended declines for a third straight day on Wednesday, supporting prices of commodities priced in the greenback. Stocks rose and bond yields tied to inflation expectations held gains from Tuesday, when Biden’s Treasury Secretary nominee Janet Yellen said that a slew of state spending was needed to fight the Covid-19 pandemic, while playing down concerns about the debt it creates.

“Precious metals were supported above all by a weaker U.S. dollar, which fell further on the back of renewed strength for stock markets,” Fawad Razaqzada, a market analyst at ThinkMarkets, said in a note. “The path of least resistance is now to the upside again,” with gold trading above last week’s high and finding support above its 200-day moving average, he said.

Gold gains on dollar weakness after Yellen

Yellen’s Tuesday testimony was key in weakening the dollar while lifting gold and base metal prices, according to Commerzbank analysts Carsten Fritsch and Daniel Briesemann. Copper had additional support on signs of greater risk appetite, the bank said. Industrial metals have been helped by expectations of increased Chinese and U.S. demand as Covid-19 vaccines continue to be be distributed and economies recover, ramping up spending on raw goods.

“The metals prices are supported by the further rising stock markets, which express the high risk appetite of market participants,” Briesemann said. “This is fed by hopes that economic life will return to normal with the vaccinations that have now begun.”

Read more: Dollar Kicks Off Biden Era With Losses as Short Bets Are Back

Biden became the 46th U.S. president in Wednesday’s inaugural ceremony that unfolded under heavy security after weeks of tumult and unrest stoked by Donald Trump. Next, traders will be looking toward the president’s ability to pass his economic stimulus plans through Congress, which would fuel another surge in metals demand in the U.S., the second-largest metals consumer after China.

“All else being equal, a Biden presidency supported by control of the House and Senate, ought to be very favorable for gold,” Bryan Slusarchuk, chief executive officer of Fosterville South Exploration Ltd., said in an email.

With Democratic leaders pushing for nearly $2 trillion in stimulus, there are “very big signals that the proverbial kitchen sink is about to be thrown at an effort to prop up a fragile economy, an effort that may have short-term impact but in the long term will cause further pain and ultimately will be negative for the U.S. dollar and positive for gold,” Slusarchuk said.

Spot gold rose 1.4% to $1,866.33 an ounce by 1:29 p.m. in New York. Silver, platinum and palladium also pushed higher. Copper prices closed 1.1% higher at $8,044.50 a metric ton on the London Metal Exchange, with all major base metals rising. The Bloomberg Dollar Spot Index dropped 0.2%


Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

No Comments, yet

Please peer review 3 community comments before your comment can be posted