Gold plunged in the Asian session following a 10-year increase in U.S. treasury revenue following reports that President Joe Biden would launch a larger stimulus plan today.
The surge in US bond yields has prompted the US dollar to continue its rise against most major currencies.
Most recently, President Joe Biden is expected to launch a $ 2 trillion Covid-19 stimulus plan, according to his adviser who has told his ally in Congress to get ready.
Following that, the gold price fell to $ 1,828 per ounce, before rising again to around the price level of $ 1,840 per ounce. Gold futures traded lower at $ 1,838 an ounce (12.20 pm Malaysian time).
While market confidence in the US economy will recover stronger, leading to an increase in US bond yields, investors are also prepared to take refuge in inflation following the implementation of this major stimulus measure.
Therefore, the decline in gold is seen to be limited and re-traded around the same level this week, after making the initial dive of the Asian session earlier.
