In preparation for the U.S. stimulus plan, oil prices grew again after their pause on Wednesday. U.S. light crude WTI (February futures contract on Nymex) remained the strongest since February 20 before the Covid-19 crisis and rose 1.3 percent to $53.57 a barrel on Thursday. March-due Brent North Sea crude rose 0.6 percent to $56.42.
Gold dropped marginally on Thursday, giving up 0.2 percent to $1,851.40 for the February Futures contract on the Comex, as a victim of the rate rise, which makes it less attractive to bonds. Bitcoin soared to about $39,700 on Thursday, rising more than 13 percent in 24 hours.
In the U.S. sovereign debt market, in expectation of the Biden program, which is associated with increasing public debt and rising inflation, long-term prices increased Thursday. On Thursday, the 10-year T-Bond yield rose 3 basis points to 1.11 percent, after touching 1.18 percent in Tuesday’s session, the highest since March 2020. In expectation of the latest fiscal stimulus package of the Biden administration, which could fuel inflation and force the Fed to slash its holdings of securities, the rate that began the year at 0.9 percent, has ignited (“tapering”).
However, on Thursday, Fed President Jerome Powell requested reassurance on the latter, promising that when it chooses to limit its holdings of government bonds and mortgage-backed securities (MBS), the U.S. central bank will alert markets ‘very early’. There is currently no topical problem of “tapering” Powell said, noting that the Fed will wait until it has “clear evidence” of success on jobs and inflation targets before withdrawing its funding.