Inflation Risks in the USA Collapse Gold Prices.
Gold Fell After Comments from the Federal Reserve
The price of gold dropped after comments from representatives of the Federal Reserve that suggested a more cautious approach by the USA regarding interest rate cuts.
According to Bloomberg, the cost of gold is around $2,640 per ounce after comments from San Francisco Fed President Mary Daly and Fed Chair Adriana Kugler about the need to combat inflation and achieve a target rate of 2%. Generally, lowering interest rates benefits gold as it does not yield interest, reports Ekonomichna Pravda.
Last month, the Fed reduced the number of planned interest rate cuts until 2025 due to the greater caution of its Chair Jerome Powell regarding the pace of lowering borrowing costs. This may present an inflationary challenge for gold after its record growth of 27% last year, driven in particular by the easing of US monetary policy.
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