Gold Stabilizes Amidst Uncertainty
Gold steadied after a weekly drop as traders looked ahead to a US Federal Reserve meeting midweek at which policymakers are expected to reaffirm their stance for higher-for-longer interest rates.
Bullion traded near $2,335 an ounce after losing more than 2% last week. The US central bank’s preferred measure of inflation rose at a brisk pace in March, according to data Friday. Swaps traders now see only one Fed reduction this year, well below the roughly six quarter-point cuts seen at the start of the year. Higher rates are typically negative for gold as it doesn’t pay interest.
Market Reaction to Fed Meeting
The upcoming US Federal Reserve meeting has left traders cautious about the future of gold prices. If the Fed reaffirms its stance for higher interest rates, it could continue to put pressure on the precious metal.
Additional Insight:
– Traders will closely monitor the Fed’s language during the meeting for clues on future rate hikes, which could further impact gold prices.
– Global economic uncertainties and geopolitical tensions also play a significant role in determining the direction of gold prices.
