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Price of Gold vs. Oil Price: Gold Price: High Tension Ahead of Fed Statements | news

by Jrg Bernhard

The interest rate decision will be announced at 8pm, after which Fed Chairman Jerome Powell will answer questions at a press conference (8.30pm). A rate hike of 50 basis points should already be discounted, so that the tenor of the Fed’s statements regarding further prospects and any details of the reduction in total assets will be of decisive importance for the near-term direction of the price of the asset. gold. If the tones are more restrictive than expected, the protection from the crisis could fall further, after all, the rise in US yields – especially for short maturities – has led to an increase in opportunity costs in recent weeks. The world’s largest SPDR Gold Shares ETF has seen no capital inflows for two weeks. During this period, its gold holdings declined from 1,106.74 to 1,089.04 tons, reflecting the decline in investor interest.

On Wednesday morning, the price of gold presented itself with weaker prices. At around 7:30 (CEST), the most actively traded gold futures (June) fell 6.30 to $ 1,864.30 per troy ounce.

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Rohl: Return of supply concerns

Market players are currently again increasingly concerned about the demand side. On the one hand, details on the EU’s sixth sanctions package, which should also affect Russian oil imports, are expected today, Wednesday. On the other hand, the report released Tuesday evening by the American Petroleum Institute showed a sharper-than-expected decline in oil reserves of 3.5 million barrels, many times higher than expected. The fossil energy source may also gain new momentum in the afternoon when the US Energy Information Administration (4:30 pm) releases its weekly report on storage reserve development and production data.

On Wednesday morning, the price of oil showed up with recovering prices. Around 7:30 am ET, the later dated WTI future was up 1.25 to $ 103.66, while its Brent counterpart was up 1.15 to $ 106.12.

Financeen.net editorial staff

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