Dollar Stable While Euro Peaked, Gold and Silver Prices Jumped

At the start of the week, on the foreign exchange market, the dollar index was little changed at 90.96 points (-0.09%) against a basket of currencies, as well as the euro, which peaked at $1.2050 on Monday (up 0.07%). Calm also prevails in bond markets, where sovereign yields stabilized on Monday, with the yield on the 10-year T-Bond at 1.17% (up 1 basis point).

Gold gained 1.2% to $1,834.20 an ounce for the April futures contract on the Comex. The yellow metal had given up 2% last week, abandoned by investors once again seduced by the risk-taking. March-maturity silver gained 2.1% to $27.57 an ounce on Monday after a volatile week.

Equity markets are now considering a spark for embracing the $1.9 trillion stimulus package from the Biden administration, seen as the engine of the reflation enthusiastically awaited by investors. The U.S. president said on Friday that he plans to “act fast” to pass his $1,900 billion initiative as Republican politicians drag their feet in the Senate.

Without a bipartisan consensus, Joe Biden gave himself the means to secure a vote last week in the Senate, enabling him to approve the plan by a single majority, not by a two-thirds majority. Thus, even though the president said that he would like to find a compromise consensus on his initiative if the negotiations failed, he might still circumvent it.

U.S. Treasury Secretary Janet Yellen, meanwhile, said on CNN on Sunday that if Congress supports the Biden proposal, next year the United States should return to full employment. On the other side, she cautioned, “the unemployment rate will remain high for years.”

Jobs estimates disappointed on Friday, January, with just 49,000 work openings and sharply updated figures for previous months. In December, not 140,000, as first predicted, but 227,000 jobs were lost by the U.S. economy.

“I’m afraid the job market is stagnating,” Yellen said in another CBS interview, reflecting on the new workforce survey. “We have 10 million Americans who are unemployed. Four million have left the labor market. We are in a chasm with regard to the labor market, and (we are) still far from getting out of it,” she also warned.

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