Gold prices fell on Thursday as the dollar climbed after the Federal Reserve – the United States central bank drew a favorable economic recovery picture, but downgraded the offer of solid signals on further stimulus. As of 0524 GMT (10:54 am in India), gold spot was down 0.8 percent at $ 1,943.70 an ounce. US gold futures slipped 1 percent to $ 1,950.50 an ounce.
“Investors in the Asia-Pacific region are probably not inspired by last night’s FOMC (Federal Open Market Committee) meeting, in which central banks are hesitant to increase stimulus in the face of improving fundamentals,” said Margaret Yang, a Delifax strategist. , Which covers currency, commodity and index trading.
“This strengthened the US dollar and weakened the price of gold,” he said.
The dollar index rose to a one-week high against its rivals after the US central bank hinted on Wednesday that it was expected to improve the world’s largest economy from the coronovirus crisis, leading to unemployment in central bank forecasts in June She was falling fast.
Meanwhile, the Bank of Japan held monetary policy steady and slightly advanced its outlook on the economy, suggesting that immediate expansion of stimulus was not needed to counter the coronovirus epidemic.
The Federal Reserve gave some support to gold, promising to keep rates near zero until inflation was on track to “exceed its 2 percent inflation target” for some time.
Lower interest rates reduce the opportunity cost of holding non-yielding bullion. Gold is also used as a hedge against inflation.
Jeffrey Haley, a senior market analyst at OANDA, said, “Low to high interest rates, quantitative easing issued by central banks and the US fiscal position remain a long-term contributory factor to potentially higher dollar gold value.”
Among other places, silver declined 1.5 percent to $ 26.82 an ounce, platinum slipped 2.3 percent to $ 946.10 and palladium slipped 1.3 percent to $ 2,367.49.