Gold prices have remained steady on Wednesday, hovering around $1,980.89 per ounce as investors sit on the sidelines ahead of the Federal Reserve’s highly anticipated policy decision. All eyes are now firmly fixed on Federal Reserve Chair Jerome Powell’s upcoming speech, scheduled for 18:30 GMT, where market participants hope to gain further clues into the central bank’s future rate trajectory.
Spot gold has shown marginal change, holding steady at $1,980.89 per ounce by 10:00 GMT. Bullion prices have retraced slightly after briefly surpassing the significant $2,000 level last week. This rally was underpinned by robust safe-haven inflows amid escalating tensions in the Middle East, leading to its most substantial monthly gain since March recorded in October.
Ole Hansen, Saxo Bank’s head of commodity strategy, commented on gold’s recent rally, saying, “This is merely a long-overdue consolidation following the robust rally observed in the past three weeks. Prices could potentially decline to at least $1,952 as part of this natural market correction.”
Market sentiment is now firmly pinned on the outcome of the Federal Reserve’s two-day monetary policy meeting, culminating at 18:00 GMT, followed by Powell’s address at 18:30 GMT. Although no adjustments in interest rates are anticipated, investors are eagerly awaiting the Federal Reserve’s assessment of the U.S. economy and any indications regarding future monetary policy decisions.
Praveen Singh, from BNP Paribas’ Sharekhan, emphasised the focus on the Fed’s forward-looking statements, stating, “The primary concern remains the Fed’s evaluation of the U.S. economy and any hints it might provide concerning its future monetary policy trajectory. Investors are eager to discern the central bank’s outlook, which will undoubtedly influence market dynamics in the coming weeks.”