Precious Metals Preview: Gold Weakens On Hawkish Fed

6 Jan 2022 , 09:31 AM

COMEX Gold pulled back in volatile trading yesterday. The metal hit a near six week high of $1830 per ounce but fell quickly thereafter as the minutes of the latest US Fed meeting showed that Fed officials plan to start reducing the amount of bonds it is holding on its balance sheet. Some officials even said that the balance-sheet reduction could start sometime after the Fed starts raising interest rates. The Fed is tapering its bond purchases now and has already indicated to the market that it will raise rates soon after it finishes that taper in March. The minutes showed officials considering to shrink the balance sheet along with raising rates. This hurt the metal and the futures tanked near $1800 per ounce. MCX Gold futures closed just above Rs 48000 per 10 grams in last session and should see a bearish start today.

Powered by Commodity Insights