Gold futures closed lower on Wednesday (March 8), after Federal Reserve Chairman Jerome Powell addressed Congress on March 2, reiterating that the Fed will accelerate interest rate hikes to curb inflation. The aggressive stance on rate hikes caused concern among investors, leading to a decline in gold futures.
- Gold futures were down by $1.40, or 0.08%, at $1,818.60 per ounce.
- Silver futures were also down by 4.80 cents, or 0.24%, at $20.151 per ounce.
- Platinum futures rose $4.30, or 0.46%, to close at $940.60 per ounce.
- Palladium futures were down by $8.50, or 0.6%, at $1,332.10 an ounce.
Powell delivered his semi-annual monetary policy and economic conditions address to the House Financial Services Committee, reiterating that the Fed will accelerate interest rate hikes to stave off inflation. The Fed’s rate hike at its March meeting will be based on information received about the labor market and inflation. If the data suggests the Fed will raise interest rates faster, the Fed is ready to speed up the rate hike.
Non-farm payroll figures for February will be released on Friday, March 10, which Powell said is crucial data. The Consumer Price Index (CPI) and the Producer Price Index (PPI) will be released next week, before the Fed holds a monetary policy meeting on March 21-22.
According to data from CME Group’s FedWatch Tool, investors are now 80% in favor of the Fed raising interest rates by 0.50% to a range of 5.00-5.25% at its March 21-22 meeting, up from 70% on Tuesday and 31% on Monday, the day before Powell’s first speech to Congress.
Investors are awaiting the release of US nonfarm payrolls figures for February on Friday. Analysts expected that the number of jobs increased by only 200,000 in February, after rising more than expected to 517,000 jobs in January.
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Thursday March 9, 2023