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Gold shines bright as US Dollar dips: Fed chairman's inflation comments spark market reaction

The gold market has seen a rise following Federal Reserve Chairman Jerome Powell's comments on inflation, which caused a decline in the value of the US dollar.

India TV Business Desk Edited By: India TV Business Desk New Delhi Published on: February 09, 2023 10:02 IST
Gold Shines Bright as US Dollar Dips: Fed Chairman's Inflation Comments Spark Market Reaction
Image Source : PEXELS Gold shines bright as US Dollar dips: Fed chairman's inflation comments spark market reaction

Gold Rate Today: On the Multi Commodity Exchange (MCX), gold futures opened at Rs. 57238.00 per 10 grams, an increase of  0.04%. Silver futures, on the other hand, opened at Rs.67,590.00 per kilogram, a decrease of 0.06%. Data from the central bank shows that China's gold reserves rose from 64.64 million ounces at the end of December to 65.12 million fine troy ounces at the end of January.

Spot silver saw rise of 0.49% and dropped to $22.30 per ounce, platinum decreased by 0.35% to $970.17 and Palladium dropped by 0.46% to $1,638.22 as of 5:41 pm GMT.

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Federal Reserve Chair Jerome Powell has stuck to his post-Federal Open Market Committee (FOMC) rhetoric, which has led to a rally in the forex and gold markets. Powell's comments have been taken as a sign of continued support for the US economy, which has boosted demand for safe-haven assets such as gold and caused a strengthening of the US dollar against other major currencies.

Investors were particularly pleased with Powell's hints at a gradual approach to interest rate hikes. This approach will give the US economy time to adjust, helping to minimize any potential negative impacts. The gradual approach also gives forex and gold traders time to adjust to changes in the market, allowing them to make informed decisions.

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The forex market is highly sensitive to changes in interest rates, as changes in rates can impact the value of currencies. A gradual approach to interest rate hikes will help to reduce the impact of any sudden changes in the market, making it easier for traders to manage their portfolios. Additionally, a stable interest rate environment can help to encourage economic growth, as businesses and consumers are more likely to invest and spend when they feel confident about the future.

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