With the decline in gold, weak dollar and bond yields, Fed Chairman Jerome Powell’s post-meeting messages focused on.
Gold continued to rise as bond yields fell and the dollar weakened, as investors priced in the Fed’s next rate move.
Spot gold hit $1,964 an ounce.
The Fed is expected to raise rates by 25 basis points this week. While this scenario is currently pricing in gold, the main focus of the market will be on Fed Chairman Powell’s post-meeting messages.
Markets are generally divided on the outlook as swap traders cut prices for another September rise. Elsewhere, yields on two-year U.S. bonds fell nearly eight basis points on Tuesday, giving gold more support.
Bond markets recalibrated after a hard sell-off in a Monday auction, reaching their highest yield since 2007.
The precious metal found a balance above $ 1,950 per ounce after the rise it experienced at the beginning of the month and made investors expect a rise for gold on the US Commodity Exchange Comex. However, this excitement was not observed in spot gold-backed exchange-traded funds, which were at their lowest level since April 2020.