Gold prices up as investors focus on Fed meeting

Gold prices rose today, Tuesday, as investors await the meeting of the Federal Reserve (the US central bank), amid growing expectations that it will slow the pace of tightening monetary policy in light of the banking sector turmoil.

According to Reuters, gold rose in spot transactions by 0.2 percent, to $ 1982.29 an ounce, by 0546 GMT. US gold futures jumped 0.1 percent to $1,984.30.

And the CME’s VideoWatch tool indicates that the markets expect by 26.9 percent that the Federal Reserve will stick to its position at the end of its scheduled meeting on March 21 and 22 and raise interest by 50 basis points, while it expects by 73.1 percent that it will raise it by 25 basis points.

Gold is considered a safe haven in times of financial uncertainty, and low interest rates make non-return bullion more attractive as it reduces the opportunity cost of holding them.

Amid volatile transactions on Monday, gold prices fell 1 percent at first, but then reversed course, jumping to their highest levels since March 2022 to $2009.59, after investors understood the impact of the measures taken by several central banks to contain a banking crisis and achieve stability in financialglobal markets.

UBS agreed to buy rival Credit Suisse on Sunday for $3.23 billion in a merger deal crafted by Swiss authorities, which led to the sale of the banks’ shares.

Analysts at (ANZ) said in a note, “Although banking regulators rushed to boost market confidence, the blurry macro background still tempts (gold) buying.”

With regard to other precious metals, silver rose in spot transactions by 0.2 percent to $ 22.57 an ounce, platinum fell 0.2 percent to $ 986.53, and palladium rose 0.2 percent to $ 1417.54.