29.06.2022
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Gold rises in price on the weakening dollar and the comments of the head of the US Federal Reserve

MOSCOW, June 22 – PRIME. The price of gold on Wednesday evening rises, the dollar becomes cheaper against major world currencies against the backdrop of statements by the head of the US Federal Reserve System (FRS) Jerome Powell about inflation, according to trading data.

The dollar lost 63 kopecks, the euro rose by 17 kopecks

As of 19.04 Moscow time, the price of the August futures for gold on the New York Comex exchange grew by $1.85, or 0.1%, to $1,840.65 per troy ounce. July silver futures fell 1.43% to $21.457 an ounce.

The dollar index (the exchange rate against a basket of currencies of six countries – US trading partners) fell by 0.39%, to 104.03 points. The depreciation of the dollar supports the demand for gold, as in this case the precious metal becomes more accessible to investors who own other currencies.

The dollar is being weighed down by comments from Fed Chairman Powell, who said earlier Wednesday that while high inflation was a “surprise,” the US economy is “very strong” and the Fed has a good opportunity for tighter monetary policy. Jerome Powell also noted that the Fed will adjust its monetary policy in accordance with the change in the state of the economy and the dynamics of consumer price growth.

Traditionally, the rate hike supports the dollar, which is negative for the price of gold. At the same time, in the current environment, tightening policy, as traders fear, could trigger a recession, and at the same time, markets are assessing whether the regulator will accelerate the pace of rate hikes.

Source: 1prime

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