Dollar Struggles, Gold Shines

3.23.23 - Dollar Struggles, Gold Shines

Gold last traded at $1,999 an ounce. Silver at $23.19 an ounce.

Gold shines as bets on Fed pause gain momentum - Reuters

(Reuters) - Gold prices extended gains to a second straight session on Thursday, boosted by a slide in the U.S. dollar and Treasury yields after the Federal Reserve signalled an end to its monetary tightening cycle might be on the cards.

Spot gold rose 0.7% to $1,982.89 per ounce by 10:25 a.m. ET (1425 GMT) while U.S. gold futures gained 1.7% to $1,981.70.

The Fed raised rates by a quarter of a percentage point on Wednesday but highlighted that it was on the verge of pausing.

"If they truly do pause that clearly has been a green light for the gold market, being a quintessential hedge against inflation. It's likely that inflation would remain elevated if they're unable to raise rates any further," said David Meger, director of metals trading at High Ridge Futures.

Gold on Monday hit a one-year high, breaching the key $2,000 level on safe-haven demand, though later ceded some ground as banking sector jitters subsided following the rescue of Credit Suisse. But the outlook remains positive if the Fed pauses or the banking crisis carries on, analysts say.