Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold edged down 0.1% to finish regular trading under $1,942 as traders awaited the Fed's decision on interest rates. The metal then surged above $1,970 in electronic trading after Jerome Powell acknowledged that inflation is starting to ebb.

As expected, the Fed raised interest rates by a quarter-point, bringing its benchmark rate to a range of 4.5% to 4.75%. Striking a somewhat hawkish note in its policy statement, the central bank also signaled that "a couple more hikes" in small increments are likely in coming months,

In his post-meeting press conference, Fed Chair Powell reiterated the need for "substantially more evidence" before declaring victory over inflation. But Powell also acknowledged that a "disinflationary process" has started in the economy "for the first time," something the markets took as suggesting that the end of the current rate cycle may be coming.

The comments came against a backdrop of weakening US data. The ISM reported manufacturing contracted for the third straight month, hitting the lowest level since the pandemic. Private payrolls added just 106,000 jobs in January, down from 253,000 in December. And US construction spending fell 0.4% in December.

Benchmark 10-year Treasury yields fell abruptly to 3.4% after Powell's comments and the softer data, lifting gold by decreasing the opportunity cost for holding it instead of bonds as a safe0haven asset.

Tracking with yields, the dollar plunged nearly 1% against major rivals. A weaker dollar supports gold and other commodities by making them less expensive in other currencies, boosting overseas demand.

The other precious metals were also lower before the Fed, then higher afterward. Silver swung from a 1% loss to a 1% gain. Platinum dropped 1.9% and then recoup more than half its loss. Palladium jumped from a 1% loss to a 0.5% gain.

At the Comex close: April gold slipped $2.50 to $1,942.80; March silver lost 23 cents to $23.61; April platinum dropped $19.40 to $1,001.70; and March palladium shed $15.70 to $1,632.60 an ounce.