Prices of the yellow precious metal on the COMEX futures spurted to 5-year higher level at 1,395.35/ounce after US Federal Reserve slashed their rate outlook for the rest of the year by roughly half a percentage point.
The US Federal Bank in its two-day policy meeting ended on Wednesday left rates on hold, however, the policy makers said uncertainties about the economic outlook could force its hand.
Chairman Jerome Powell said others agree the case for lower rates is building.
The stance has disappointed investors, who were expecting the Fed to cut rates as soon as next month. The disappointment kept the dollar at one-week low level, which in turn boosted investors demand for the greenback-denominated commodities like gold, base metals.
Besides, investors are also focusing on trade talks between the US and China. As per media reports, US Trade Representative Robert Lighthizer said he will confer with his Chinese counterpart Vice Premier Liu He before next week’s meeting between President Donald Trump and Chinese President Xi Jinping in Osaka.