New York, US (BBN) – Gold prices gained in Asia on Thursday, shrugging off a Fed rate hike and language that suggested at least two more ahead this year as investors looked ahead to the Bank of Japan’s latest policy review.
Gold for April delivery on the Comex division of the New York Mercantile Exchange rose 1.65 per cent to $1,220.55 a troy ounce, reports
The BoJ will release its latest policy views around noon Japan time, while Australia is expected to post a gain of 16,000 in employment change figures for February for a steady unemployment rate of 5.7 per cent.
Overnight, the market noted the widely expected fed rate hike of 0.25 per cent on Wednesday by the Federal Reserve Open Market Committee (FOMC), which marked the highest Fed Funds rate since October 2008, with up to three increases seen this year.
“The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data,” the latest statement said.
Fed Chair Janet Yellen fielded a raft of questions concerning the Fed’s decision to raise rates; future monetary policy decisions and the current as well as future prospects of the US economy.
Yellen struck a somewhat dovish tone, as she said the US central bank would continue to provide accommodative monetary policy to support the US economy but warned against a prolonged period of lower rates in order to avoid a situation which forces the Fed to “raise rates rapidly.”