Skip to content

Gold Price Rises 1% After Fed Calms Investor Nerves

Gold prices rose more than 1% on Thursday, a day after Federal Reserve Chairman Jerome Powell allayed investor fears that the US central bank could pursue highly aggressive interest rate hikes. .

As expected, the Fed raised its benchmark overnight rate by 50 basis points on Wednesday, the biggest jump in 22 years. However, Powell said he was not considering 75 basis point moves in the future.

Spot gold was up 1.1% at $1,901.30 an ounce by 1221 GMT, having hit its highest level since April 29. US gold futures added 1.7% to $1,899.60 an ounce.

Nitesh Shah, an analyst at WisdomTree, said gold was getting some support on concerns the Fed could tighten monetary policy too much, triggering a recession and increasing bullion’s appeal as a defensive asset.

While gold is perceived as a hedge against inflation, higher US interest rates and bond yields raise the opportunity cost of holding bullion, while also boosting the dollar in which the metal is priced. precious.

The Bank of England raised interest rates to their highest level since 2009 but warned the economy was at risk of recession.

Among other precious metals, silver added 0.3% to $23.02 an ounce, while platinum fell 0.6% to $985.46 and palladium fell 0.2% to $2,251.14 an ounce.

Source: Elcomercio

Share this article:
globalhappenings news.jpg
most popular