Gold prices surged on Thursday after the Federal Reserve (Fed) cut interest rates as expected on Wednesday, hinting at a pause in the easing cycle and not a reason for the precious metal to rally.
At 9:30 a.m., gold was at $4,267, down 0.30% since it opened early Friday in Asian trading.
Early Thursday morning, the Fed cut interest rates by 25 basis points despite price pressures remaining high with inflation approaching 3%.
However, the central bank hinted at a possible pause in further easing when Chairman Jerome Powell stressed that the Fed is now in a ‘wait and see’ mode, while also stating that current rates are closer to the neutral range.
On the economic data front, the US labor market showed signs of softening as last week’s jobless claims failed to meet expectations.
Meanwhile, other data showed the US trade deficit narrowed in September, according to the US Census Bureau.
In geopolitical developments, peace talks between Ukraine, the US and Russia continued after Ukrainian President Volodymyr Zelenskyy submitted a revised 20-point peace plan to the US, according to an ABC News report.
For the upcoming session, market attention will be on speeches by several Fed officials including Anna Paulson of the Philadelphia Fed, Beth Hammack of the Cleveland Fed and Chicago Fed President Austan Goolsbee.
