Gold prices slightly up in early trade

22 Mar 2023 , 09:04 AM

On Wednesday, gold prices increased slightly as the dollar dropped, and investors closely followed the U.S. Federal Reserve’s decision on interest rates and its outlook for policy.

Spot gold was up 0.2% at $1,942.96 per ounce. At $1,946.20, U.S. gold futures increased 0.3%.

On Tuesday, gold prices fell by roughly 2% as some investors cautiously shifted back to riskier assets as concerns over a banking crisis subsided.

According to the CME FedWatch tool, a rate increase of 25 basis points (bps) is projected when the Fed announces its interest rate decision later in the day.

As the dollar index was somewhat lower, buyers holding other currencies would pay less for bullion.

Prior to the Bank of England’s announcement of its monetary policy on Thursday, the markets will also assess the UK’s February inflation data, which is also due on Wednesday.

In the midst of the greatest financial sector crisis in more than a decade, U.S. Treasury Secretary Janet Yellen told bankers on Tuesday that she is willing to step in to protect depositors in smaller U.S. banks experiencing deposit runs that threaten further contagion.

The largest gold-backed exchange-traded fund in the world, SPDR Gold Trust, reported that its holdings decreased 0.16% on Tuesday to 923.11 tonnes from 924.55 tonnes on Monday.

Spot prices for palladium increased by 1% to $1,401.54, platinum increased by 0.4% to $972.53, and silver increased by 0.3% to $22.43 per ounce.

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