Gold prices fell to the lowest level in 10 weeks With the strength of the dollar and anticipation of the Fed’s decision

38271 gold prices fell to the lowest level in 10 weeks with the strength of the dollar and anticipation of the feds decision

Gold prices fell to the lowest level in 10 weeks, during trading today, Thursday, with the strength of the US dollar and anticipation of the Federal Reserve’s decision.

Markets are awaiting the Fed’s interest rate decision; The US central bank is scheduled to hold its meeting next Wednesday, amid strong expectations of a new interest rate hike.

The prices of the precious metal fell by more than 15 dollars in the session yesterday, Wednesday; Because of the strength of the US currency.

Gold Prices

The price of gold futures contracts, for June delivery, decreased by 0.11%, or $1.93, to reach $1,887.60 an ounce.

At the same time, the price of spot delivery of the precious metal settled at $ 1886.86 an ounce, after it was trading at $ 1877 in early trading, the lowest level since February 16.

As for other metals, the price of silver contracts, for June delivery, fell more than 0.88%, to $23.06 an ounce.

Meanwhile, the spot platinum price rose more than 0.3%, or $2.51, to reach $920.55 an ounce, and the spot palladium price increased by more than 2.1%, or $47.92, to record $2,242.17 an ounce.

Meanwhile, the dollar index, which monitors the performance of the US paper against a basket of 6 major currencies, rose by 0.5% to reach 103.449 points.

Strong Pressure

While an ounce of gold was holding above the $1900 barrier, it was under strong pressure from the US dollar and the expected Fed decision.

The dollar index rose to its highest level since late 2002, which makes gold less attractive to holders of other currencies, given that gold prices are denominated in the green.

Gold was also negatively affected by expectations that the US Federal Reserve will raise interest rates by 50 basis points (0.5%) at its next meeting.

It is noteworthy that the precious metal is strongly affected by the rise in US interest rates and high bond yields, while increasing the opportunity cost.

However, gold remains a safe haven of value during times of economic and political crisis and even geopolitical tensions.

Global demand for gold rises to the highest level since late 2018

Demand For Gold

Global demand for gold jumped by about 34%, during the first quarter of this year, recording the highest level since late 2018.

This strong demand – according to the quarterly report of the World Gold Council – came with a more than doubled jump in investment demand with strong inflows into gold-backed ETFs.

In contrast, consumer demand for gold declined by about 7% in the first 3 months of 2022, losing the momentum recorded throughout 2021.

Source: XglobalMarkets

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