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Gold Holds Near Record as Traders Overlook Delayed Cuts Scenario - BLOOMBERG
BY , Bloomberg News
The precious metal is up about 15% so far this year.
, Bloomberg
(Bloomberg) -- Gold rose to trade near a record-high, even as investors weighed a shift in messaging from Federal Reserve chief Jerome Powell, who said the US central bank will likely keep rates on hold for longer than originally planned.
The precious metal is up about 15% so far this year, with gains partially driven by haven demand as geopolitical tensions in the Middle East and Ukraine continue to escalate.
Bullion closed little changed on Tuesday after Powell said that it’s appropriate to give the Fed’s restrictive policy further time to work, and pointed to the lack of additional progress made on inflation in recent months following several strong US economic prints.
His comments caused Treasury yields and the dollar to jump, and spurred another collapse in market-implied expectations for Fed rate cuts this year. Higher borrowing costs and a stronger dollar are typically a negative for the non-yielding precious metal, yet gold remains in a weeks-long uptrend that has surprised some onlookers.
Long-standing supports — including robust buying by central banks and increased demand from Chinese consumers — are also underpinning prices.
Spot gold rose 0.5% to $2,393.53 an ounce as of 10:30 a.m. in London, close to its all-time high of $2,431.52 reached on Friday. The Bloomberg Dollar Spot Index dropped 0.3%. Silver and palladium rose, while platinum was steady.
