On the Nymex (December contract), WTI oil advanced 0.1 per cent to $41.13, while gold reported its fourth session of declines, weighed down by a return to risk appetite. For the December futures contract on the Comex, the yellow metal ounce gave up 0.1 percent to $1,885.10 on Tuesday. Against a basket of benchmark currencies, the dollar index dropped 0.25 percent to 92.73 points. The yield on the 10-year T-Bond dropped 4 basis points to 0.87 percent on the U.S. bond markets.
In recent weeks, the Federal Reserve called for short-term caution on economic growth, which showed signs of slowing in the fall, after getting restarted in the summer following the spring recession linked to the coronavirus pandemic.
Fed officials, beginning with its President, Jerome Powell, claim that monetary but also fiscal help will still be required for the U.S. economy, even though vaccines are being designed to reach the market rapidly. It could take months for vaccines to be mass produced and delivered to U.S. and global communities, not to mention certain people’s unwillingness to use vaccines, which may decrease their overall effectiveness.
Although the Fed indicates that in order to sustain progress, it might increase its asset purchases, the possibility of a new comprehensive fiscal support plan appears to have fallen. Supported by the Democratic Party of President-elect Joe Biden, the proposal met with the resistance of Republicans before the November 3 presidential election, who have a majority in the Senate and are expected to remain so amid Joe Biden’s election to the White House.
On the other end, President-elect Joe Biden on Monday, predicting a “dark winter” urged Congress to quickly develop a new plan for an immediate start of a recovery process of the country’s economy. He also emphasized on the implantation of a fair tax policy, which the financial markets are not in favor of.