Gold prices edged lower on Wednesday amid rising Treasury yields, and moved up slowly after the Federal Reserve announced its decision to hold its benchmark interest rate unchanged.
Benchmark U.S. 10-year Treasury yields jumped to their highest since April 13 and the dollar rose against its rivals, denting the appeal of the safe-haven asset.
The dollar index, which fell into negative territory after exhibiting strength earlier in the day, briefly emerged into positive territory ahead of Fed’s rate decision, but slipped soon after the central bank announced it will hold rates unchanged.
The dollar index was down 0.14% at 90.78 a little while ago.
Gold futures for June ended down $4.90 or about 0.3% at $1,773.90 an ounce.
Silver futures for May ended lower by $0.325 at $26.085 an ounce, while Copper futures for July ended up by $0.0120 at $4.4975 per pound.
The Fed, which updated its assessment of the U.S. economy but maintained its ultra-easy monetary policy as widely expected. The bank left the target range for the federal funds rate at 0 to 0.25%.
After previously saying inflation continues to run below 2%, the Fed now acknowledges that inflation has risen but largely attributed the increase to “transitory factors.”
The statement from the central bank also said risks to the economic outlook remain due to the ongoing public health crisis, although that reflects an improvement from last month, when the Fed cited “considerable risks to the economic outlook.”
The central bank also said it plans to continue its bond purchases at a rate of at least $120 billion per month until “substantial further progress” has been made toward its goals of maximum employment and price stability.
The material has been provided by InstaForex Company – www.instaforex.com