Gold held firm near a one-week high on Thursday as progress on a U.S. fiscal stimulus deal weighed on the dollar, while a pledge by the Federal Reserve to keep rates low until an economic recovery is secure lent further support.U.S. congressional negotiators haggled on Wednesday over details of a $900 billion COVID-19 aid bill that is expected to include $600-$700 stimulus checks and extended unemployment benefits, causing the dollar to languish near a more than two-year trough.

The Goldman Sachs analysts offer their take on Wednesday’s FOMC decision, where the Fed pledged to maintain bond buys until the economy sees ‘substantial’ gains.

The key notes of the FOMC decision are “FOMC left the funds rate target range unchanged at 0-0 25%. “Provided new guidance on the timeline for tapering asset purchases by announcing that it will continue to increase its asset holdings at the current rate “until substantial further progress has been made toward the Committee’s maximum employment and price stability goals.”

“FOMC did not announce charges to the maturity composition of its asset purchases.”“However, the dot plot showed only one additional participant (five total. vs. our expectation of six projecting a rate hike by 2023. “

On the other hand, The United States and Europe should agree to cooperate in opposing any future “hurtful” subsidies used by China to build up its commercial aircraft industry, U.S. Trade Representative Robert Lighthizer told.Lighthizer said he was working to settle a 16-year-old dispute between Washington and Brussels over past government aid to aircraft manufacturers, but expressed frustration that current World Trade Organization rules would not prevent future subsidies by the European Union or China.

“If this plays out, they can start a new subsidy tomorrow, and drag out that litigation for five or six years, and there’s nothing under the WTO that you can do about it at all,” Lighthizer said in a rare interview late on Tuesday. He also said that he had made several proposals to settle the matter before the Trump administration leaves office on Jan. 20.

XAU/USD 4 Hour Chart:

Support: 1850.9 (S1), 1837.3 (S2), 1829.8 (S3).

Resistance: 1871.9 (R1), 1879.3 (R2), 1892.9 (R3).

Amidst all the catalysts weakening the dollar, we expect a bullish trend for XAU/USD.