Gold rallies as markets absorb latest Fed meeting minutes

Gold prices rebounded today, Feb. 22, as investors absorbed the minutes of the Federal Reserve’s latest policy meeting issued yesterday, which showed that bulk of policymakers were concerned about the risks of cutting interest rates too soon.

Bullion for April delivery added 0.48% to trade at $2,044 an ounce at 11:28 am Makkah time, with spot prices also up 0.29% to $2,031.86 per ounce.

Following suit, silver contracts for March delivery jumped by 1.26% to $23.39 per ounce, in tandem with a 0.89% hike in platinum spot prices to $895.60 an ounce.

The Fed’s meeting minutes indicated that members of the rate-setting Federal Open Market Committee (FOMC) ruled out reducing the target range for interest rates “until they had gained greater confidence that inflation was moving sustainably toward 2%.”

Consequently, members stressed they will follow a cautionary, data-based approach in dealing with monetary policy, with the top priority remaining to ensure economic stability and the gradual return to the targeted inflation level.

“The Fed is not going to cut rates or raise rates, so I think there is upside potential in gold,” said Daniel Pavilonis, senior market strategist at RJO Futures, Reuters reported.