Gold sank to a one -week low after being impressed by Federal Reserve (Fed) Chairman Jerome Powell’s expression that interest rates would be raised soon.
In the Asian session, spot gold traded gloomily at $ 1,816 per ounce, plunging further from the 9 -week high it reached in Tuesday’s trading session, $ 1,853 per ounce.
The yellow metal has previously gained support as a safe-haven following market concerns over Ukrainian-Russian geopolitical tensions that have involved many major powers, including the United States and Europe.
In addition, continued upward price pressures also supported gold to rise higher due to its role as a hedge to inflation.
However, to address rising inflation, it has triggered tightening actions by major central banks.
Most recently, the Fed hinted at an interest rate hike it would take after its monthly bond -buying program ended in March and was poised to act faster to fight inflation.
The Fed statement also spurred a 10 -year rise in U.S. treasury yields to return to two -year highs and drive the U.S. dollar’s surge.
