Gold prices eased lower after being impressed by a statement by Federal Reserve (Fed) Chairman Jerome Powell that indicated a reduction in its asset purchases would be accelerated.
During the Asian trading session, the yellow metal traded at $ 1,777 per ounce, failing to maintain previously recorded gains above the $ 1,800 per ounce price level.
Meanwhile, gold futures traded little changed at around $ 1,778 an ounce.
Testifying before the Senate Banking Committee at the New York session, Powell said the monthly bond purchase rate cut could move faster than the original schedule for the $ 15 billion -a -month reduction announced this month.
Powell also stopped the word ‘temporary’ on inflation, signaling his concern over rising price pressures.
Investors are now optimistic that interest rates will rise faster than expected, in line with the termination of the bond -buying program earlier.
Following that, the US dollar surged higher and pushed gold -priced metal trading lower.
Gold is typically used as a hedge to inflation, but rising interest rates cause an increase in the opportunity cost of holding gold.
