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Gold prices rallied on Tuesday and the dollar weakened after U.S. lawmakers shared their latest proposal for stimulus spending to help the country’s economy.

Spot gold rose about 1 percent to $1,845.43 per ounce, while U.S. gold futures were up 0.9 percent at $1,848.75.

The dollar held near a more than two-and-a-half-year low after a bipartisan Covid -19 relief proposal has been split into two bills in a bid to breach the ongoing stimulus impasse.

The $908 billion pitch from a group of Republican and Democrat lawmakers consists mainly of a $748 billion bill focused on points of common ground in an effort to win approval.

A second bill, worth $160 billion, accounts for the major sticking points of a boost to state and local governments.

Investors also await the outcome of key central bank meetings this week for directional cues.

Federal Reserve officials are set to meet today and tomorrow. The U.S. central bank may steer clear of additional stimulus, but ramp up its dovish rhetoric and emphasize the need for more fiscal support.

The Bank of England on Thursday and the Bank of Japan on Friday will close out central bank meetings for 2020.

The Swiss National Bank is expected to keep its policy rate locked at minus 0.75 percent on Thursday, the lowest among major central banks.


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