Gold price falls to the lowest after one month

The gold price It fell to a one-month low on Thursday as comments from Federal Reserve (Fed) Chairman Jerome Powell on the need to control inflation strengthened bets for a quicker monetary policy tightening and countered refugee demand. due to omicron.

At 11:02 GMT, spot gold was down 0.4% at $ 1,775.80 an ounce, after hitting its lowest level since November 4. Gold futures in the United States were down 0.5% at $ 1,775.30.

In his second day of testimony in Congress on Wednesday, Powell said the Fed must be ready to respond to the possibility that inflation will not subside in the second half of 2022 and the central bank would consider a more rapid reduction of its purchases of bonuses at your meeting this month.

It is believed that a faster withdrawal from the bond purchase program would open the door to an anticipated rise in interest rates, which would raise the opportunity cost of owning gold, which does not yield interest.

The possibility of a quicker stimulus withdrawal could limit bullion’s bullish momentum and strengthen the dollar and U.S. Treasury yields, which would also reduce the attractiveness of gold, said Michael Hewson, chief market analyst at CMC Markets UK.

Investors are now awaiting the November US employment report, due out on Friday. Data from Wednesday showed that private payrolls grew by 534,000 last month.

“A decent set of employment figures also has the potential to push gold down towards $ 1,740, but overall the bullion is still trading within a range, with a ceiling of around $ 1,810 and a floor of US $ 1,740”Hewson added.

Gold’s losses were limited by concerns about the omicron variant of the coronavirus, which has forced countries around the world to plan more stringent restrictions.

Among other precious metals, spot silver was up 0.2% at $ 22.36 an ounce and platinum was up 1% at $ 942.45. Palladium fell 0.4% to $ 1,740.91 an ounce.

With information from Reuters.