Strong Dollar Sends Gold Down.
London, Wednesday, 11 May 2022
Gold fell below $1,840 per ounce, continuing a three-week slide and remaining under pressure from the strong dollar.
Expectations of more Federal Reserve monetary tightening to combat inflation and fears of slowing global economic growth led investors into safe assets, pushing the dollar index over 104, its highest level in 22 years.
The Federal Reserve hiked its benchmark overnight interest rate by 50 basis points last week, the largest increase in 22 years, but Chair Jerome Powell said the bank would not consider a 75-basis-point hike in the future.
He did, however, reassure Americans that the central bank will do everything possible to contain rising inflation, despite the fact that this may result in economic pain.
Investors are now looking forward to the May US inflation data for more information on the central bank's rate-hiking plans.
(Written and edited by: The Decision Maker)