free webpage hit counter

Gold remained near support at $1,730 as the Fed minutes revealed no major surprises

Editor’s Note: With so much market volatility, stay on top of the daily news! Get caught up in minutes with our quick summary of today’s must-read news and expert opinions. Sign up here!

(Kitco News) – The gold market fell sharply as the Federal Reserve tightened further aggressive monetary policy later this month, testing long-term support above $1,730 an ounce.

According to some economists, the minutes of the Federal Reserve’s June monetary policy meeting gave the market few surprises as the central bank focused on rising inflation over growth.

“Most agreed that inflation risks were to the upside and cited several risks associated with ongoing supply disruptions and rising energy and commodity prices,” the minutes said.

At the same time the committee saw growing risks to the economy.

“Participants assessed that uncertainty about economic growth over the next couple of years has increased,” the minutes said. “Downside risks included the possibility that further tightening in financial conditions could have a larger negative impact on economic activity than expected.”

The gold market is under pressure but has seen little reaction to recent minutes. August gold futures last traded at $1,736.60 an ounce, down 1.55% on the day.

The minutes highlighted the potential for another 75 basis point rate hike later this month.

“Participants judged that an increase of 50 or 75 basis points would be appropriate at the next meeting. Participants agreed that the economic outlook justified a move to a more restrictive stance of policy, and they recognized that an even more restrictive stance may be appropriate if elevated inflationary pressures persist,” the minutes said.

Some analysts have questioned the Federal Reserve’s resolve as recessionary clouds begin to gather. However, the minutes show that the Fed is determined to fight inflation.

“A significant risk the Committee now faces is that high inflation may become entrenched if the public begins to question the Committee’s resolve to adjust the policy stance as warranted. On this issue, participants emphasized that appropriate confirmation of monetary policy with clear and effective communications is essential in restoring price stability.

Disclaimer: The views expressed in this article are those of the author and may not reflect those Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; However, Kitco Metals Inc. Nor does the author guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. And the author of this article accepts no liability for losses and/or damages caused by the use of this publication.

Leave a Reply

Your email address will not be published.

Previous post How to avoid the worst Instagram scams
Next post Your gas stove may be leaking toxins. Here’s how to stay safe