Gold Up, WHO Warns Against Considering Omicron “Mild” By

© Reuters.

By Gina Lee

– Gold was up on Friday morning in Asia but remained close to a two-week low hit during the previous session. A warning from the World Health Organization (WHO) that the omicron COVID-19 variant cannot be considered “mild”, alongside stronger yields, gave the safe-haven asset a boost.

Gold futures inched up 0.06% to $1,790.25 by 9:20 PM ET (2:20 AM GMT), but the yellow metal was set for its worst weekly fall since late November 2021. Benchmark U.S. 10-year Treasury yields rose to their strongest level since March 2021.

Although omicron appears to produce less severe disease than the delta strain of the virus, it should not be categorized as "mild", according to WHO director-general Tedros Adhanom Ghebreyesus.

Even the most dovish of U.S. Federal Reserve officials are on board with the central bank’s hawkish policy. San Francisco Fed President Mary Daly said at an event on Thursday that trimming the Fed balance sheet would come after normalizing the Fed funds rate. St. Louis Fed President James Bullard said at a separate event that the Fed could raise its target interest rate as soon as March 2022.

According to the CME FedWatch tool, investors are currently anticipating a greater than 70% chance for a rate hike of at least 25 basis points at the March Fed meeting.

On the data front, investors now await the U.S. jobs report, including non-farm payrolls, due later in the day. Thursday’s initial jobless claims data showed that the number rose to 207,000 for the previous week.

In Asia Pacific, data released earlier in the day showed that Japan’s household spending contracted 1.3% and 1.2% year-on-year and month-on-month in November. The Tokyo core consumer price index (CPI) grew 0.5% year-on-year in December.

In other precious metals, silver was flat at $22.16 an ounce, while platinum edged up 0.2% and palladium inched up 0.1%.

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