Spot Gold rebounded from a 1-week low of $4,842.60/oz. on Wednesday, as investors awaited the minutes from the Federal Reserve’s January meeting, which may provide fresh clues over monetary policy trajectory.
The Fed left its federal funds rate target range intact at 3.50%-3.75% at its January 27th-28th meeting, following three successive rate cuts last year that brought borrowing costs to their lowest level since 2022.
FOMC policy makers highlighted that economic activity had been expanding at a solid pace, job growth had remained slow, while inflation had remained somewhat elevated.
Fed Chair Powell noted the US economy was coming into the new year on a firm footing and current interest rates were appropriate to promote progress toward both of the US central bank’s objectives.
Powell had also said that the central bank was “well-positioned” to evaluate incoming data on a meeting-by-meeting basis without adhering to a predetermined rate path.
Chicago Fed President Austan Goolsbee said on Tuesday that the US central bank could approve “several more” rate cuts for 2026, in case inflation resumed easing toward the 2% target.
Investors are currently pricing in 75 basis points of rate cuts this year, with the first likely in June or July.
Spot Gold was last up 1.17% on the day to trade at $4,934.70 per troy ounce.
The yellow metal retreated more than 2% on Tuesday, after Iran and the US reached an understanding on “guiding principles” for nuclear talks. Yet, it remained uncertain if a deal was imminent.
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