Gold topped $2,200 an ounce for the first time after the Federal Reserve maintained its outlook for three quarter-point rate cuts this year, suggesting they aren’t alarmed by a recent uptick in inflation.
Policymakers kept their outlook for the cuts in 2024 and moved toward slowing the pace of reducing their bond holdings. While Fed Chair Jerome Powell continued to highlight officials would like to see more evidence that prices are coming down, he also said it will be appropriate to start easing “at some point this year.”
Bullion has jumped sharply this month, setting a series of record highs, with gains partly driven by mounting expectations for looser US monetary policy, an environment which typically benefits the non-yielding precious metal. Speculation around the timing of the Fed’s long-anticipated pivot to rate cuts may have provided the trigger for the latest gains, with data showing that traders boosted their net long positions on gold last week by the most since 2019.
Once interest rates come down, gold stands to gain even more momentum as bullion-backed exchange traded funds look likely to increase their holdings following months of outflows, according to UBS Group AG. That would add to broader support from massive purchases by central banks in emerging markets, led by China, and heightened geopolitical risks from Gaza to Ukraine to this year’s US election that have underlined the commodity’s appeal as a haven asset.
Spot gold rose as much as 1.6% to $2,220.89 an ounce before trading at $2,202.31 at 7:15 AM in Singapore.
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
'Borrowed' leaders: Congress hits out at AAP for not fielding their own candidates in Punjab
Apr 28, 2024 9:53 PM
EC asks AAP to modify election campaign song and Kejriwal's party is miffed
Apr 28, 2024 9:25 PM