Another record from gold

Gold rose above $2,200 an ounce for the first time after the Fed maintained its forecast for three rate cuts this year. Bullion rose to a record in early trading before paring gains. It has been rallying since mid-February, supported by rising geopolitical risks and long-standing spurts including central bank purchases led by China. But the rapid rise surprised many seasoned market watchers. The rally was driven in part by expectations of easier monetary policy in the U.S., which the Fed reaffirmed on Wednesday. Chairman Jerome Powell continued to emphasize that officials want to see more evidence that prices are falling, but said “most people’s view is that we will have that confidence and that there will still be rate cuts.” “What we saw last night was really a green light for gold investors to come back. The Fed said they’re tolerant of our inflation right now. I saw that they’re tolerant of the labor market strength not being a drag,” said Chris Weston, head of research at Pepperstone Group. Speculation about the timing of the Fed’s long-awaited move may have been a factor in the recent gains, with data showing investors increased their net long positions on gold by the most since 2019 last week.