“The reaction was normal in the sense that Chairman Powell highlighted the strength of the economy and the determination to fight inflation,” said Carsten Fritsch, a commodities analyst at Commerzbank.
On Wednesday, Powell struck a tough tone, pointing to a rate hike in March, sending the dollar to its highest level since July 2020.
U.S. economic growth accelerated in the fourth quarter as companies replenished depleted inventories to meet strong demand for goods, helping to make 2021 its best result in nearly four decades.
The gold metal had benefited in recent days from weak stock markets, underpinning its safe-haven status, but following the Fed’s comments, both gold and stocks fell, meaning that the economic outlook presented by the Fed are much more important to the gold market, Fritsch added.
Bullion prices have lost nearly 3% since hitting a 10-week high on Tuesday.
In other precious metals, spot silver sank 3.7% to $22.61 an ounce for its biggest daily percentage drop since late September. Platinum fell 1.2% to $1,019.06; and palladium gained 2.4% to $2,385.85 for its eighth straight gain.
Source From: Ambito
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