Gold Trims Losses After U.S. Fed Minutes
Alex Boltyan | Aug 17, 2022 03:44PM ET
Gold prices trimmed intraday losses during the New York session yesterday following the release of the Federal Reserve's latest meeting minutes.
Spot gold, XAU/USD, jumped from a two-week low of around $1,760 an ounce toward the $1,780 area, taking back some of its early losses. However, the metal still posted a daily loss of 0.4%.
The Federal Open Market Committee's latest minutes revealed that some participants believed that the policy rate should remain at a "sufficiently restrictive level" for some time to ensure that inflation was firmly on a path back to the Fed's target of 2%.
On the other hand, many members pointed out that there was also a risk that the Committee could tighten the stance of policy "by more than necessary" to restore price stability.
At the July meeting, Fed officials voted to raise their benchmark rate by 75 basis points for the second straight meeting, the fastest pace since the 1980s.
The dollar weakened across the board after the minutes but overall retained gains versus most competitors. At the same time, U.S. yields pulled back across the curve, with the one on the 10-year note sliding to 2.879% from a daily peak of 2.919%.
Still, XAU/USD has climbed back above the 20-day SMA, which is acting as immediate support at around $1,765, followed by the $1,750 zone. On the other hand, the first resistance is seen at the $1,785 area and the $1,800 psychological level.
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