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Gold rose in Asia on Thursday morning, while the dollar fell after the Federal Reserve of the United States indicated in its latest policy decision that it will accelerate asset reduction and raise interest rates.
By 11:25 p.m. ET, gold futures were up 1% to $1,782.15 per ounce (4:25 AM GMT). The dollar, which usually moves in the opposite direction of gold, fell slightly on Thursday.
Following the Fed’s policy announcement on Wednesday, the yellow metal fought its way back up after falling over 1% to a two-month low.
It plans to increase its asset-tapping operation to $30 billion every month. It also kept its interest rate constant, but forecasts three quarter- point increases in 2022, three more in 2023, and two more in 2024.
Inflation is expected to be 2.6 percent in 2022, up from 2.2 percent in September 2021, according to the central bank’s revised economic predictions.
“The market was looking for a hawkish move from the Fed and they got it in the dot plot,” precious metals trader Tai Wong said. “The market is happy that the Fed is a little spooked and doesn’t want to be too far behind the curve.
For gold, the key technical level is $1,750; a break substantially below that could lead to a rout in the waning days of the year.”
Story by : Norvisi Mawunyegah