(Bloomberg) — Gold rose as investors looked ahead to US economic data, after the Federal Reserve offered few clues on its next policy steps.
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Bullion advanced to about $2,778, some $12 off its all-time-high. A gauge of the greenback nudged down 0.1%, after gaining in the wake of the Fed’s news conference Wednesday. Fed Chair Jerome Powell said officials won’t rush to lower US interest rates, adding that the central bank is pausing easing to see further progress on inflation.
Swaps traders now price in about 50 basis points of rate cuts this year, while many banks predict no cuts at all. Higher rates tend to pose a headwind for gold, as it doesn’t pay interest.
The next clue on the health of the US economy will come later Thursday, when fourth-quarter GDP figures are released.
The Fed’s stance comes as President Donald Trump creates uncertainty over the broader economic outlook by threatening to slap tariffs on imports and promising to lower taxes, both of which could put upward pressure on inflation. When asked about the potential impact of the new administration’s policies, Powell said the central bank was in a “wait-and-see” mode.
Spot gold rose 0.7% to $2,778.10 an ounce at 11:49 a.m. in London. Silver, platinum and palladium also gained.
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