Trump signs off on government funding and Covid-19 fiscal stimulus bill

On Sunday President Trump signed off on the legislation to fund the government avoiding a shutdown that would have begun on Tuesday, coupled with a fiscal stimulus aid package. Collectively the expenditures contained in this bill amount to $2.3 trillion, of which $900 billion is allocated to fund the second stimulus package, and the remaining $1.4 trillion to be allocated to fund the government budget.

According to CNN, “Congressional leaders announced Sunday night that they have secured a deal for a sweeping $900 billion rescue package to deliver much-needed relief for small businesses, unemployed Americans and health care workers while bolstering vaccine distribution.”

McConnell’s statement was followed by a joint statement from Speaker of the House Nancy Pelosi and Senator minority leader Chuck Schumer which said, “We are going to crush the virus and put money in the pockets of the American people.”

The fiscal relief package will fund automatic payments of up to $600 per adult. It will also provide direct aid for small businesses that have been struggling by allocating roughly $284 billion through the paycheck protection program. It will extend the enhanced unemployment benefits of an additional $300 per week for unemployed Americans. As well as allocate $25 billion for rental assistance and extend the eviction moratorium.

This additional aid will also include help for the educational system providing $82 billion worth of funding to help reopen classrooms safely. It will fund $10 billion of aid to assist with childcare needs and $13 billion for the supplemental nutrition assistance program and child nutrition benefits. Additionally, the stimulus package will allocate billions of dollars to pay for the vaccine distribution, testing, and contact tracing efforts.

This announcement sparked a rally in U.S. equities taking the Dow, S&P 500, and NASDAQ Composite to new record highs. It was highly supportive of silver pricing which gained over 2% on the day. However, it had a negative impact on gold pricing.

In trading overseas last night gold futures basis the most active February 2021 contract broke above $1,900, trading to a high of $1,904 before correcting. As of 4:00 PM EST gold futures are currently fixed at $1,876.70 which is a net decline of $6.30. As we enter the last trading week of the year attention to the solid gains in U.S. equities limited any sustainable gains in gold which could have kept pricing above $1900 per ounce. The dollar closed, in essence, unchanged, and is currently fixed at 90.28, which is an increase of 0.03%.

Silver futures basis the most active March 2021 Comex contract gained $0.53 (+2.07%) taking silver to $26.445 per ounce. Overall precious metals price changes today were muted by a phenomenal upside jump in bitcoin and bitcoin futures pricing. Currently, the most active January 2021 bitcoin contract which is traded on the Chicago Mercantile exchange gained $3,425, which is a net gain of 14.46%, making a single Bitcoin now worth around $27,000.

Wishing you as always, good trading and good health,