By Barani Krishnan
Investing.com - Gold prices rose for a second straight day on Tuesday as speculation that the White House and Congress will reach a deal for a new coronavirus stimulus before the Nov. 3 U.S. election inspired bulls in the yellow metal to chase the market higher again.
But Chuck Schumer, a leading Democrat who’s familiar with the negotiations between the Democrats and the Republican-led Senate aligned with President Donald Trump, said he did not expect the two sides to agree to anything before the election in two weeks.
That could reverse the positive sentiment seen this week in gold, which has gained at the expense of the dollar.
“Nothing is going to pass with this administration,” Schumer said at a news conference held to discuss the progress over the Covid-19 stimulus.
“We will try to get an aid deal during the lame-duck session,” he added, referring to the period between the election and January inauguration of the next presidency, which the Democrats hope will be won by their candidate Joe Biden.
House of Representatives Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin were in a phone conversation at the time of writing, but Schumer said he did not hold out hope for that either. That seemed to concur with a Washington Post report that Senate Majority Leader McConnell had told the White House “not to make a deal because Pelosi isn't negotiating in good faith.”
U.S. gold for December delivery settled at $1,915.40, up $3.70, or 0.2%. It rose 0.3% on Monday.
Spot gold, which reflects real-time trades in bullion, rose $6.72, or 0.4%, to $1,910.86 by 3:34 PM ET (19:34 GMT).
Congress, led by Pelosi and the Democrats, approved a Coronavirus Aid, Relief and Economic Security (CARES) stimulus in March, dispensing roughly $3 trillion as paycheck protection for workers, loans and grants for businesses and other personal aid for qualifying citizens and residents.
Democrats have been locked in a stalemate since with Republicans on a successive package to the CARES, arguing over the size of the next relief, as thousands of Americans, particularly those in the airlines sector, risked losing their jobs without further aid.
Trump trails Biden in most polls ahead of the Nov. 3 election. A preliminary agreement over the stimulus could be a positive talking point for the president in his campaign.