International gold futures fell to their lowest level in more than a week on Wednesday, putting pressure on concerns about the US stimulus package and the strengthening of the dollar as markets waited for the Fed to announce its policy decision.
Gold futures continued their decline after the Federal Reserve announced its interest rate decision.
At 13:30 on January 27th in New York (02:30 on January 28th in Beijing), COMEX February gold futures, the most actively traded, fell $6, or 0.6%, to settle at $1844.90 an ounce.
March silver futures, the most actively traded, fell 14.9 cents to settle at $25.389 an ounce.
April platinum futures fell $28.40 to settle at $1079.0 an ounce.
March palladium futures fell $14.50 to settle at $2310.50 an ounce.
Among other COMEX metals, copper for three-month delivery, the most actively traded, fell 6. 2 cents to settle at $3.5575 a pound.
Bob Haberkorn, senior market strategist at RJO Futures, said: "before the announcement by (FOMC), the Federal Open Market Committee, stocks fell and the dollar rebounded somewhat, which put pressure on the gold market."
The dollar index rose to its highest level in more than a week, making gold more expensive for investors holding other currencies.
"the $1.9 trillion stimulus package [in the US] is quite large, and I don't think President Biden has enough support to pass it," he said. "this is another reason why gold is not trying to get back above $1900."
The Biden administration's stimulus plan faces strong Republican opposition to the size of the plan.
At 3 a.m. on Thursday, the Fed announced that it would keep its benchmark overnight interest rate at near zero while keeping the size of its monthly bond purchases unchanged, renewing its commitment to maintain these measures to support the economy. until the economy rebounds fully from the recession triggered by the pandemic.
"the Fed does sound a little pessimistic and a little worried about the pace of recovery and vaccination progress," said ennadiy Gold berg, senior interest rate strategist at TD Securities. "this is the first time they have mentioned this in a statement, and they say it will continue to be a drag on the economic recovery."
In addition, analysts and traders have cut their forecasts for gold prices, but still expect gold prices to recover from current levels, with many expecting gold prices to hit record highs this year, according to a survey released on Wednesday.
According to the median forecast from a survey of 40 analysts and traders, the average price of spot gold in the January-March quarter is expected to be $1900 per ounce, the annual average price is expected to be $1925 per ounce, and the average price in 2022 is expected to be $1908 per ounce.
Goldman Sachs said on Wednesday that it firmly believes that gold is still an attractive investment for medium-and long-term investors.
