Gold surges amid economic uncertainty

4 Apr 2024 , 10:28 AM

As Federal Reserve Chair Jerome Powell emphasized that recent job growth and higher-than-expected inflation readings do not fundamentally alter the broader picture of the central bank’s monetary policy, gold shot to a new high on Thursday.

Spot gold was up 0.1% at $2,300.53 an ounce, having earlier in the session reached a new high of $2,302.29. Since last Thursday, gold has consistently reached record highs.

American gold futures increased by 0.2% to $2,320.50 an ounce.

Powell stated that, “assuming the economy evolves broadly as we expect,” a lower policy interest rate will be appropriate “at some point this year,” in agreement with his fellow Fed members.

The CME Group’s FedWatch Tool indicates that traders are pricing in a 62% chance that the Fed will start reducing rates in June. Holding bullion has a lower opportunity cost when interest rates are lower.

According to foreign exchange strategists surveyed by Reuters, the U.S. dollar will stay strong over the upcoming months as markets continue to pull back on expectations for the timing and scope of Fed interest rate decreases.

The Russian Finance Ministry announced that in the upcoming month, it will more than quadruple its purchases of gold and foreign money.

According to investors, hedge funds ended the first quarter with gains across a variety of strategies as the industry weathered a less exciting time for bonds thanks to rallies in equities, certain commodities, and the currency.

The most likely source of funding for Caledonia Mining Corporation’s proposed $250 million gold mine in Zimbabwe is thought to be African development banks.

Spot silver increased by 0.1% to $27.24 per ounce, palladium increased by 0.9% to $1,022.50, and platinum increased by 0.2% to $938.93.

For feedback and suggestions, write to us at [e-mail]