Business Maverick

Business Maverick

Gold Steady as Investors Weigh Policy Outlook, Omicron Risks

Bloomberg Best of the Year 2021: A worker loads 12,5 kilogram gold ingots onto a trolley ready for distribution at the JSC Krastsvetmet non-ferrous metals plant in Krasnoyarsk, Russia, on Monday, July 12, 2021. Photographer: Andrey Rudakov/Bloomberg

Gold was steady as investors weighed the outlook for monetary policy against the risks posed by the omicron virus variant to the global economic recovery. 

The Federal Reserve is likely to raise interest rates in March, with officials saying they may need to implement hikes faster than expected to curb the hottest inflation since the 1980s. Meanwhile, traders are reconsidering an earlier kickoff for the first European Central Bank rate increase in more than a decade.

While the Bank of Japan is seen sitting tight on policy while adjusting its view of inflation risks Tuesday, Governor Haruhiko Kuroda is expected to emphasize his commitment to continued easing in pursuit of the bank’s distant price target.

On the virus front, President Joe Biden’s chief medical adviser on the pandemic Anthony Fauci said it’s too soon to know whether the rapid spread of the new variant will hasten the end of the health crisis.

Gold is holding above $1,800 an ounce after dropping for the first time in three years in 2021 amid the prospects of monetary policy tightening and the deployment of vaccines. Still, bullion’s traditional role as an inflation hedge and the uncertainty over omicron’s impact is supporting demand for the haven asset.

Spot gold was little changed at $1,819.08 an ounce by 8:03 a.m. in Singapore, after rising 0.1% Monday. The Bloomberg Dollar Spot Index was steady after adding 0.1% in the previous session. Silver and palladium were flat, while platinum advanced.


Comments - Please in order to comment.

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

[%% img-description %%]

The Spy Bill: An autocratic roadmap to State Capture 2.0

Join Heidi Swart in conversation with Anton Harber and Marianne Merten as they discuss a concerning push to pass a controversial “Spy Bill” into law by May 2024. Tues 5 Dec at 12pm, live, online and free of charge.

A South African Hero: You

There’s a 99.8% chance that this isn’t for you. Only 0.2% of our readers have responded to this call for action.

Those 0.2% of our readers are our hidden heroes, who are fuelling our work and impacting the lives of every South African in doing so. They’re the people who contribute to keep Daily Maverick free for all, including you.

The equation is quite simple: the more members we have, the more reporting and investigations we can do, and the greater the impact on the country.

Be part of that 0.2%. Be a Maverick. Be a Maverick Insider.

Support Daily Maverick→
Payment options