Gold rallies to begin the week; investors look nervously toward the start of October
(USAGOLD – 9-28-2020) – Gold rallied to begin the week as the dollar weakened and investors looked nervously toward the start of October – a month not regarded as particularly friendly to financial markets. It is up $11 at $1875. Silver is up 36¢ at $23.34. The markets are keeping a wary eye on Congress to see if it can meet Fed Chairman Powell’s appeal for a fiscal package to augment the central bank’s massive stimulus over the past several months. There has been talk about a prolonged stall on the economy as Washington turns its attention to the nomination of a new Supreme Court justice. Stocks, though, are up this morning – an indication that those concerns may have cooled, at least in the early going today.
Chart of the Day
Chart note: “A ‘perfect storm’ of surging government debt levels, plunging real bond yields, rising coronavirus cases and deteriorating economic forecasts pushed the price of gold to an eight-year high [in late June], and some analysts now project the metal to top its all-time high within the next 12 months,” says analyst Frank Holmes of US Global Investors. Holmes finds himself in the company of a large number of analysts who have predicted the metal would reach all-time highs. He says gold is trading inversely to falling bond yields as shown in the chart.