On Wednesday the U.S. dollar rose to a two-month high and gold eased after
hawkish Federal Reserve remarks reinforced expectations of tighter policy.
Dollar strength raised the cost of dollar-priced gold for holders of other
currencies. Saxo Bank commodities strategist Ole Hansen said gold remains
trapped in a narrow $4,300–$4,400 range and that Fed commentary, its effects on
U.S. rates, bond yields and the dollar, plus oil moves, are directing short-term
flows. Richmond Fed President Barkin said rate hikes and the prospect of further
increases could restrain firms’ inflation expectations and cool price growth
without materially depressing activity.
