Gold Rates Are Gaining Globally, As US PCE Inflation Rises: New Covid Variant Concerns

New Covid Variant Concerns

A new variant of the Coronavirus is keeping the markets under pressure, hence gold rates are increasing. According to reports, gold traded 0.80% higher, and silver traded 0.29% higher at $23.64/oz, overnight as worries of a new Covid-19 variant hit the markets. A coronavirus increase will lead to hurdles for economic activities. Earlier the delta variant of the Covid virus impacted the second wave largely. The pandemic affects both the supply chain and manufacturing sectors that certainly breaks the ecosystems of the demand-supply chain. So, investors intend to reply on assets like gold and other precious metal.

Inflationary pressure

On the other hand, yesterday, the Bureau of Economic Analysis, under the US Department of Commerce reported the country's Personal Consumption Expenditures (PCE) Price Index data of October and stated that the costs of goods and services increased by 0.6%, in the month. This year, in July PCE YoY was at 4.1%, 4.2% in August, and 4.4% in September. In October the index increased by 5%. Earlier, the report was published that the Consumer Price Index (CPI) increased to 6.2% in October, which was the highest gain since November 1990.

The gold market upcoming trend

The upcoming trend of the gold market is expected to rise significantly as Jerome Powell has been re-appointed as the US Fed Chairman, and he is not going to hike the interest rate any time soon. Gold is expected to cross the $1900/oz level in the next year. Now gold is being traded at around $1810/oz, again.