Gold prices increased slightly yesterday, ending at 65,750 rupees per ounce. Traders were waiting impatiently for the U.S. Federal Reserve’s monetary policy announcement and Fed Chair comments, hoping to gain some insight into the possibility of rate reduction.
The Federal Reserve kept interest rates in the predicted range of 5.25% to 5.5%, but it also said it would drop rates three times before the year was over. The Committee also increased its prediction of real GDP growth this year to 2.1% from the prior estimate of 1.4% in December, which was a considerable increase.
The sustained demand for gold as a haven and central bank purchases amid geopolitical tensions supported the metal even with the economic growth outlook dim. Gold’s enduring appeal as a hedge against uncertainty is demonstrated by the fact that China’s central bank has continuously added gold to its reserves for 16 straight months.
The bullish attitude was somewhat subdued, though, by the lackluster activity in the physical gold market. Exports of Swiss gold to India increased significantly, but month over month, the country’s gold exports fell short of their eight-year peak. The Reserve Bank of India (RBI) bought 8.7 tonnes of gold in January, the most precious metal it has bought since July 2022.
