Posted 3rd marzo 2023

Gold Price News: Gold Closes in on $1,850 Despite Hawkish Central Bankers

gold bar graph stack AU

The trading week is drawing to a close with gold recovering more ground to close in on $1,850 an ounce, despite hawkish rhetoric from officials at both the Federal Reserve and the European Central Bank. 

In the US, Christopher Waller said that recent inflation data pointed to the need for interest rates to climb above 5% while Raphael Bostic warned of the case for rates to go higher still, even though he still favours a 25-basis point increase when the Fed next meets. Meanwhile, in Europe, the ECB’s Pierre Wunsch said an outlook where the bank’s interest rate reaches 4% sounded right given how stubbornly high inflation is proving.

Yet despite these cautionary remarks, gold has made steady progress to increase almost $30 an ounce from its late February low. This suggests that the underlying support for gold from Asian consumers and central banks as soon as the price dips remain significant as the precious metal has been able to maintain its upward trajectory. 

Whether the buying interest remains once gold climbs above $1,850 will be interesting to see as the macroeconomic outlook is likely to cap gains around that point with an environment in which interest rates continue to rise reducing the appeal of the non-yield-bearing precious metal.


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