Gold slides below $2040 following Powell’s comments

Fed Chair Jerome Powell has signaled potential rate cuts based on economic progress, stating that there is no rush to change existing monetary policy.

The Gold Index has reacted to Powell’s rejection of bets on a March rate cut and emphasis on a cautious approach to managing inflation. Gold prices have trimmed previous gains and dropped as the US central bank chose to leave interest rates constant while rejecting speculation of rate cuts. Powell pushed back against rate cuts in March, driving the yellow metal price towards the day lows.

The economic outlook remains uncertain, and the committee will remain “highly attentive” to inflation risks. In its monetary policy meeting, Fed officials voted unanimously to keep rates unchanged, stating that it would be appropriate to reduce rates until there is greater confidence that inflation is sustainably moving toward its 2% goal.

Gold is puking toward $2030, extending its losses sharply after Powell’s remarks disregarding a rate cut in March. If sellers push prices below the lows of the day of $2032, it looks for a drop to January 25 low of $2009.66. On the flip side, if the daily high is taken out, $2050 is up next, followed by the $2090 and $2100 figure.

In addition, the Chair Jerome Powell, pushed back against rate cuts in March, driving the yellow metal price towards the day lows. At the time of writing, XAU/USD trades volatile within the $2030 – $2040 zone as market participants digest Powell’s comments. The precious metal is trading at $2038.86 per ounce at the time of writing.