Home Business Gold prices flat on caution ahead of Fed policy meet

Gold prices flat on caution ahead of Fed policy meet

6 min read
Comments Off on Gold prices flat on caution ahead of Fed policy meet


Article content

Gold prices traded in a tight range on

Tuesday, as cautious investors focused on the Federal Reserve’s

Article content

policy decision this week where the U.S. central bank is

expected to hike rates aggressively in an effort to curb


Spot gold held its ground at $1,676.12 per ounce, as

of 0406 GMT.

U.S. gold futures rose 0.4% at $1,685.50.

The Fed, at the conclusion of its two-day policy meeting on

Wednesday, is expected to raise interest rates by 75 basis

points (bps), with market participants even seeing a 19% chance

Advertisement 2

Article content

for a 100 bps increase.

“Higher Treasury yields and a stronger dollar on the back of

expectations for more aggressive Fed’s policies have been

headwinds for gold prices,” IG market strategist Yeap Jun Rong


“More aggressive projections from policymakers compared to

current market expectations could reveal a higher-for-longer

stance for rates, which may not be well-received by gold


Rising interest rates dent gold’s appeal, as they increase

the opportunity cost of holding non-yielding bullion.

Even though the dollar index dipped 0.2%, it wasn’t

far from a 20-year high. A firmer greenback makes bullion more

expensive for other currency holders.

The benchmark 10-year Treasury yield held close to its

Advertisement 3

Article content

highest level in over a decade scaled on Monday.

Mirroring investor sentiment, holdings in the SPDR Gold

Trust , the world’s largest gold-backed exchange-traded

fund, fell to 30,799,131 ounces on Monday, the lowest since

March 2020.

Inflation concerns have also prompted other central banks

across the globe to tighten monetary policy.

Spot gold may edge up to a resistance at $1,685 before

falling, according to Reuters technical analyst Wang Tao.

Elsewhere, spot silver lost 0.6% to $19.50 per ounce.

Platinum fell 0.1% to $918.51 and palladium was

down 2.4% at $2,172.19.

(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by

Sherry Jacob-Phillips and Rashmi Aich)



Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.


Source link

Load More Related Articles
Load More By 
Load More In Business
Comments are closed.

Check Also

When is the Right Time of Year to Transport Your Vehicle?

Transporting a vehicle can be a stressful experience, especially if you are unsure about t…