Gold Up, With U.S. Stimulus Measures Making Progress

Gold was up on Monday morning in Asia, with investors welcoming the news that the U.S. Congress reached a deal on the latest stimulus measures.

Gold futures were up 0.70% at $1,902.20 by 11:11 PM ET (4:11 AM GMT), passing the $1,900 mark. The U.S. Commodity Futures Trading Commission said on Friday that hedge funds and money managers raised their bullish positions in COMEX gold and silver contracts in the week to Dec. 15. The dollar was also up on Monday, capping gains for the yellow metal.

Republicans and Democrats reached agreement on a $900 billion package over the weekend. The House of Representatives will vote on the bill later in the day, followed by the Senate.

However, a rapidly spreading new strain of COVID-19 in the U.K., Described by U.K. Health Secretary Matt Hancock as “out of control,” overshadowed the news as the U.K. imposed fresh restrictive measures.

Physical gold was sold at a discount in India during the previous week for the first time in six weeks as a rebound in local prices squeezed demand. Purchases also slowed in other Asian hubs ahead of the upcoming holidays.

Meanwhile, Russia’s gold reserves stood at 73.9 million troy ounces as of the start of December, the country’s central bank said on Friday.

France, Germany, Italy, the Netherlands, Ireland and Belgium have closed their borders to travelers, and in some cases freight from the U.K. Other countries, such as Canada, Argentina and Chile have also banned flights from the U.K. Other countries are considering similar bans.

The U.K. is also continuing negotiations with the European Union (EU) for a post-Brexit trade deal. Although the U.K. insisted on Sunday the EU shift position to open the way to a post-Brexit trade pact, EU chief Brexit negotiator Michel Barnier said, “Both the EU and U.K. must have the right to set their own laws and control their own waters. And we should both be able to act when our interests are at stake.”