WASHINGTON (dpa-AFX) - Gold futures settled slightly lower on Wednesday on rate hike concerns as Fed Chair Jerome Powell reiterated before the House Financial Services Committee that the central bank is likely to continue raising rates to contain inflation.
Despite prospects of interest rate hikes, the dollar stayed weak today, and this helped limit gold's downside.
The dollar index fell to 102.12, losing more than 0.4%.
Gold futures for August ended lower by $2.80 at $1,944.90 an ounce.
Silver futures for July ended down $0.424 at $22.810 an ounce, while Copper futures for July settled at $3.9135 per pound, gaining $0.0300.
'Nearly all FOMC participants expect that it will be appropriate to raise interest rates somewhat further by the end of the year,' Powell said in his testimony today.
The Fed left rates unchanged last week, but the central bank's latest projections suggest it plans to resume raising rates later this year, forecasting a rate of 5.6% by the end of 2023.
If the Fed decided to revert to its recent quarter-point increases, the forecast suggests the central bank will raise rates two more times this year.
The forecast for additional rate hikes come as Powell noted inflation pressures continue to run high and said the process of getting inflation back to the Fed's 2% target has a 'long way to go.'
CME Group's FedWatch Tool is now indicating a 76.9% chance the Fed will raise rates by another quarter point following its next meeting in late July.
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