President Biden’s American Infrastructure Plan address to Congress coincided with a statement from the Federal Reserve, giving gold a double whammy of good news on Wednesday.
The latest statement on monetary policy saw the Federal Reserve reiterate its intention to maintain an accommodative monetary policy, something that also heavily favours the gold bulls and promises to give prices a boost.
Despite recognising that the economy is recovering and the outlook is now more promising as a result of vaccine effectiveness, Chairman Jerome Powell also noted that these shoots of hope do not allow the Fed to change its stance on monetary policy any time soon.
He said, “It’s not time to start talking about tapering. We’ll let the public know well in advance. It will take some time before we see substantial further progress. We had one great jobs report. It is not enough to start talking about tapering. We’ll need to see more data.”
We have seen since the start of the pandemic and the rapid shift to economic stimulus measures that this style of monetary policy is nothing but great news for gold.