Gold moves in a tight range ahead of Fed interest rate decision

Gold prices moved in a narrow range today, Wednesday, with the reluctance of some investors to trade, pending the decision of the Federal Reserve (US Central Bank) regarding interest rates and a clear picture regarding the future of monetary policy.

According to Reuters, gold settled in spot transactions at $ 1940.11 an ounce by 0540 GMT, after falling 2 percent on Tuesday. US gold futures rose 0.1 percent to $1,942.10.

“The market is still witnessing rapid developments, but according to the current situation, it seems that the wounds of the banking sector have begun to heal after the emergency support packages and the authorities’ reassurances,” said Christopher Wong, a strategist at (OCBC) for currency trading.

The precious metal recently jumped about ten percent, or about $ 180, to its highest level in a year, thanks to the demand for it as a safe haven after the collapse of the American Silicon Valley bank and a crisis in the Credit Suisse bank. But prices calmed after the Credit Suisse bailout revived risk appetite, despite the continued uncertainty about the financial system.

Treasury Secretary Janet Yellen told bankers on Tuesday that the US banking system was stabilizing, but that more steps may be needed “if small institutions are faced with a rush to withdraw deposits, which poses a threat of a spillover crisis.”

Investors’ eyes are now focused on the US Federal Reserve’s decision, which is scheduled to be issued at 1800 GMT, to be followed by a press conference by Fed Chairman Jerome Powell. The US central bank is widely expected to raise interest rates by 25 basis points, according to CME’s Video Watch tool.