Gold Extends Weakness Ahead Of Fed

2 May 2022 , 02:15 PM

Gold extended further weakness on Monday, moving back towards its two-month low levels seen in the previous week. The yellow metal is losing ground towards $1.880 levels as US treasury yields are settling near 41-month highs ahead of the Federal Open Market Committee statement on monetary policy on Wednesday. The dollar index, that measures the greenback against a basket of currencies is lingering at 103 levels, a near 20-year high, pushed higher by yields. Gold is unable to stay supported despite economic and geo-political tensions as possibility of a Fed rate hike attracts flows into higher yielding assets. Investors brace for a key Federal Reserve meeting later this week where it is widely expected to raise interest rates by a hefty 50 basis points. Fed policymakers look set to deliver a series of aggressive rate hikes at least until the summer to deal with rapid inflation and surging labor costs.

Powered by Commodity Insights