Gold Bulls Inch Past $1,750 as Fed Reiterates Near-Zero Rate Promise By

© Reuters.

By Barani Krishnan – The mid-$1,700 perch seems to be a surer bet for gold bulls after the Federal Reserve’s latest policy meeting minutes reinforced its promise to hold U.S. interest rates at near zero and to continue providing the economy with cheap money until it was clear of Covid-19.

for June settled up $6.50, or 0.4%, at $1,752.10 per ounce, rising for a second day in a row after Monday’s brief momentum loss following last week’s one-month highs of above $1,760. 

, which tracks real-time trades in bullion, was up $4.19, or 0.2%, at $1,748.72. On Friday, it hit 7-1/2 year highs of $1,751.54.

Wednesday’s run-up was particularly encouraging to longs in the yellow metal as it occurred side by side with the rally on Wall Street. The two asset classes have fallen together during many market crashes triggered by the coronavirus pandemic. But they have rarely risen together.

“Gold remains a favorite spot for investors who remain skeptical of the stock market rally,” said Ed Moya, analyst at New York’s OANDA.

“It seems like only a matter of time before gold runs higher as the fundamental backdrop indicates global stimulus efforts will continue to grow and the prospect of negative interest rates for the U.K. and U.S. seem to be growing.”

Gold’s latest run-up came after the Fed’s April meeting minutes published on Wednesday showed that inflation will be constrained in the near future by weak demand for good and services and significantly lower oil prices, making sense for the world’s largest economy to hold interest rates at near zero to spur a recovery from Covid-19. The central bank also pledged to use all monetary tools at its disposal to continue supporting the economy.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

{n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};
s.parentNode.insertBefore(t,s)}(window, document,’script’,
fbq(‘init’, ‘751110881643258’);
fbq(‘track’, ‘PageView’);

by :

Source link

Capital Media

Read Previous

Huawei s’oppose aux modifications de la règle sur les produits étrangers directs, apportées par le ministère américain du commerce

Read Next

L’entreprise Moderna est passée de l’ombre à la lumière, sur la simple promesse d’un vaccin contre la Covid-19