Gold News & Info

Source:Dana Samuelson, American Gold Exchange

AustinBoth gold and silver rebounded from yesterday’s sharp declines in today’s New York session. Gold gained 0.35% to finish the New York session at $2,311.00, while silver gained a modest 10 cents up to $26.48. Both metals enjoyed further gains in the electronic session with gold ending the US session up another $8.55 to $2319.55 and silver up another 20 cents to $26.68.

As expected, the Fed left rates unchanged at the conclusion of today’s meeting. Citing recent persistent inflation, the Fed indicated they would continue to take a wait and see approach towards when it might be appropriate to alter the current fed funds rate. With a full quarter of firmer inflation now in the rearview mirror, Chairman Powell said confidence that inflation was headed towards their 2% target was lower than it was at the conclusion of their March meeting.

“We’ve stated that we do not expect that it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2%. It is likely that gaining such greater confidence will take longer than previously expected,” Powell said.

Additionally, the Fed announced that beginning in June they would slow the reduction of their balance sheet known as QT. Specifically, their monthly bond run-off would decline from $60 billion to $25 billion per month. From here forward the Fed is taking a more cautious approach towards further balance sheet reduction to head off potential market volatility.

During a similar bond reduction phase in September 2019, tightening liquidity conditions caused a dramatic spike in bank-to-bank overnight borrowing rates, disrupting overnight lending markets. The Fed was forced to intervene by injecting billions of dollars of liquidity into the system.

At the New York spot close: gold gained $8.10 to $2,311.00; silver rose 11 cents to $26.48; platinum gained $7.05 to $954.90; and palladium shed $4.20 to $948.60 an ounce.