Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 1.1% to close under $1,910 ahead of the Fed's post-meeting policy statement, pressured by peace talks in Ukraine and expectations of higher interest rates. The metal then bounced back above $1,920 after hours on relief that the first hike in two years was only a quarter-point.

To combat the highest inflation in 40 years, the Fed raised interest rates and charted out additional rate increases in coming months, projecting year-end rate of 1.9%. The central bank acknowledged that its policy outlook would remain uncertain in the near-term because of the ongoing pandemic and economic fallout from Russia's invasion of Ukraine.

Wall Street applauded the relative dovishness of the increase, with all three major indexes rallying from losses to gains in relief that the rate view was not more hawkish. Many investors had been bracing for a series of half-point increases.

The Dow rose 0.8% while the S&P 500 gained 1.5% and the Nasdaq 2.8%.

Adding to risk appetite, Ukrainian President Volodymyr Zelensky said today that peace talks with Russia were progressing and solution was seeing more realistic.

Benchmark 10-year Treasury yields rose on the rate hike and risk sentiment, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The other precious metals were mostly lower, with silver and palladium sliding 1.8% and 1.9%, respectively, while platinum added 0.6%.

At the Come close: April gold dropped $20.50 to $1,909.20; May silver fell 45 cents to $24.71; April platinum added $5.60, to $1,008.10; and June palladium shed $44.70 to $2,367.30 an ounce.