Gold Clambacks: The Bull Still Rolling Despite Fed Glitches
Gold’s been dancing higher for the third straight day, hovering near $2,018 per ounce. While the Fed’s interest‑rate dance steps are being tweaked, the metal’s not missing a beat.
Why Gold’s on a Roll
- Producers’ Price Index surprises us: January’s numbers outpaced forecasts, giving the dollar a boost but leaving investors wary.
- Fed officials shrug off the spike in consumer inflation, calling it a brief tantrum rather than a lasting trend.
- Raphael Bostic, from Atlanta’s Fed, hints that the movement in core inflation might eventually let the Fed lower rates this summer—something that could choke gold’s ascent.
Even though the chances of a June rate cut are slimmer, the market keeps that hope alive. Big interest rates mean people chase high‑yield assets, cutting the appeal of a non‑yielding superstar like gold.
What’s Coming Up
Next on the agenda:
- The People’s Bank of China will set its policy, probably holding steady.
- Will see new stimulus? Chinese authorities might roll out more easing in the coming months.
- Middle‑East tensions: Hezbollah’s vow to back Gaza could spur gold’s safe‑haven roll‑up.
Still, the Fed’s FOMC minutes released Wednesday are the festival of the week. They’ll give traders a chance to gauge the market’s mood and belt out moves on gold.
Us vs. The Economy
US data this week—think Treasury yields, the dollar—could push bonds higher if figures bang hard. That’s a classic fireworks show for markets often tweaking rate‑cut timelines. We’ll likely stay steady after today’s close.
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