Gold prices declined sharply on Wednesday and the front-month gold futures contract settled at a fresh 2-month low, as the dollar extended its gains to yet another session.
The dollar index rose to 94.31 a little before noon, rising from an early low of 93.93. It was last seen at 93.25, up nearly 0.3% from the previous close.
The greenback has been gaining in strength with surging coronavirus cases across Europe resulting in increased demand for the safe-haven currency.
Gold futures for December ended down $39.20 or about 2.1% at $1,868.40 an ounce.
Silver futures for December slid $1.318 to settle at $23.105 an ounce, while Copper futures for December settled at $2.9930 per pound, down $0.0680 from the previous close.
Federal Reserve Chairman Jerome Powell, continuing to testify before Congress for the second day, said, the U.S. Congress and the Federal Reserve both need to “stay with it” in working to bolster the economic recovery.
Despite progress in rebounding from the coronavirus economic downturn, “there is a long way to go,” with millions still jobless compared to where the economy was in February, he said.
“We need to stay with it … The recovery will go faster if there is support coming both from Congress and the Fed,” Powell said.
On Tuesday, Powell told the U.S. House Financial Services Committee that the world’s largest economy has a long way to go before fully recovering from the coronavirus pandemic.
Separately, U.S. Treasury Secretary Steven Mnuchin said Tuesday that he and the White House continue to seek an agreement with both parties in Congress on another fiscal relief package.
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