Gold Down as Fed Officials Try to Ease Inflation Concerns
Gold was seen down on Tuesday morning in Asia, but remained near its highest level in more than four months, as investors dwell on comments by the US Federal Reserve that aim to ease inflation concerns.
Fed Governor - Lael Brainard, Atlanta Fed President - Raphael Bostic and St. Louis Fed President - James Bullard said a surge in prices, due to bottlenecks and supply shortages as the number of COVID-19 cases continue to fall, would not be surprising. However, they also reiterated that any price gains are likely to be temporary. Bullard also added that he expect the inflation rate to be above 2% both in 2021 and 2022.
“Fed speak continues to support the idea that inflation in the U.S. will be transitory and that is good enough to keep short-term bullish momentum in place for gold... gold continues to face resistance from the $1,900 level, so if the dollar stabilizes over the next couple of sessions, bullion might remain steady” Oanda Corp. senior market analyst - Edward Moya told Bloomberg.
Gold was down 0.23% to $1,880.15 by 4:08 AM GMT, while USD fell to a four-month low. U.S. Treasury long-dated yields also fell to two-week lows.
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