Gold soared higher after Federal Reserve (Fed) Chairman Jerome Powell failed to give a clear signal about the timeline of its asset purchase cuts in a speech at the Jackson Hole symposium last week.
In today’s Asian session, gold rose to a three -week high of 1,823 per ounce, before reducing gains slightly to trade around $ 1,815 per ounce.
As seen in the minutes of a recent FOMC meeting, Powell hinted at the possibility for the central bank to begin reducing bond purchases by the end of the year.
However, not as investors expected, Powell did not say exactly when they would implement it. In fact, he also gave an indication that this reduction will not lead to a direct increase in interest rates.
Concerns about the increasingly contagious delta variant also led Powell to be more cautious in talking about stimulus withdrawal, saying they would carefully evaluate future data and risks that arise.
This indirectly reassures investors that the US central bank is in no hurry to reduce its stimulus amid the rising Covid-19 pandemic.
As a result, the US dollar plunged to a two -week low against major rivals and in turn gave support for this precious metal soaring higher.
