Gold prices climb on talk of further U.S. fiscal stimulus

Gold last traded at $1,870 an ounce. Silver at $25.98 an ounce.

NEWS SUMMARY: Precious metal prices eased back on normal profit-taking despite a weaker dollar. U.S. stocks traded mixed, as investors bet on strong earnings from big tech companies next week.

 Marketwatch--"Gold prices climbed on Wednesday, on track for their highest finish in nearly two weeks, as expectations for further fiscal stimulus measures under the Biden administration looked to pressure the U.S. dollar, boosting prices for the dollar-denominated precious metal.

The market expects additional fiscal stimulus measures to be 'announced very soon,' providing support for gold, said Chintan Karnani, chief market analyst at Insignia Consultants. In testimony to the Senate Financial Committee Tuesday, incoming President Joe Biden's nominee for head of the Treasury Department, Janet Yellen said the U.S. should 'act big' on the economy.

More stimulus would create more debt, which would lead to a weaker dollar, which can boost prices for gold....U.S. Treasury yields 'will fall if and when additional stimulus is announced,' said Karnani and lower bond yields are bullish for gold....

Bullish gold investors made the case that accommodative central banks across the globe and Biden's legislative agenda, highlighted by an ambitious $1.9 trillion coronavirus relief proposal, will ultimately provide support for gold and weaken the greenback."