Gold records week-low after Fed’s Powell statement

Gold prices fell to their lowest level in a week today, Wednesday, after Federal Reserve Chairman (US Central Bank) Jerome Powell said that it is likely that it will take to raise interest rates more than expected to reduce inflationary pressures.

According to “Reuters”, gold fell 0.1 percent in spot transactions, to $ 1812.44 an ounce, by 0634 GMT. US gold futures also fell 0.2 percent to $1,816.50.

Powell, on the first day of his two-day semi-annual congressional testimony, said the Federal Reserve was likely to need to raise interest rates more than expected in the face of recent strong data, and that he was ready to take larger steps if “total” indicated. The information received indicates the need to take more stringent measures to curb inflation

In the wake of Powell’s comments on Tuesday, gold prices fell 1.9 percent, or more than $30, to $1,812.55 per ounce.

High interest rates usually weaken the attractiveness of gold because they increase the opportunity cost of owning the non-returnable asset.

Markets now expect a 50 basis point rate hike at the Fed’s monetary policy meeting on March 21-22.

The dollar index rose to its highest level in three months, making the precious metal more expensive for buyers who hold other currencies.

With regard to other precious metals, silver fell in spot transactions by 0.1 percent to $ 20.03 an ounce, while platinum rose 0.8 percent to $ 936.72 and palladium 0.3 percent to $ 1391.40.