Gold ANALYSIS 17-MAR-21
The precious metal gained quite a bit in price on the back of the falling dollar and US Treasury bond yields before the Fed meeting. Since last week, gold prices have generally shown a positive trend. The US dollar declined slightly, and vaccination problems in Europe increased investor interest in protective assets in the short term. At the same time, speculative long positions continued to be liquidated in all metals, with the exception of platinum. The outflow of investors from ETF funds invested in gold and silver also continued.
After the U.S. House of Representatives finally approved a $1.9 trillion economic assistance bill last week, discussions immediately began on a new $2 trillion infrastructure upgrade package. Large-scale stimulus measures increase inflation expectations and lead to a constant increase in US government bond yields, which in the future may lead to a weakening of the US currency and will have a positive impact on the value of precious metals. So far, the gold market continues to move within the medium-term correction. After falling to the local low of $1,676, the asset reached a strong resistance of $1,730 and stabilized in a narrow range.