The sparkling metal gold lost its shine of safe haven appeal this week as it experienced a 2.6% drop in its value. The Gold Futures are hovering around $1766 at 1500 HRS PKT after experiencing a fall in five consecutive sessions. The significant drag on gold prices were the FOMC meeting minutes and expectations of unconquerable inflation, which signals that interest rates will remain elevated. The Federal Bank may not pivot its tightening monetary policy until the start of 2024; however, the pace of the surge may be dialed back. Moreover, the policymakers anticipate that the inter-bank rates of the U.S may stroll around 3.5% by the mid of year 2023. The economists offer divergent views and have placed a 40% probability of a 75 basis point hike in the Fed rate next month.
More bad luck charms for the yellow metal were released in the form of U.S Unemployment Insurance Claims and the Philadelphia Manufacturing Index on Thursday, August 18 at 1730 HRS PKT. The Unemployment Claims witnessed a slide of 2000 for the first time in three weeks; furthermore, the Manufacturing Index astoundingly sweetened by 6.4% against a negative forecast. The unexpected news made the biggest antagonist of the precious metal-Dollar, happy as a Larry, and the index jumped with joy to 107.68- the highest since July 18.
Gold’s future is likely to remain bleak until the next monetary policy rate is announced.
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