Fed Chairman Jerome Powell reiterated on Thursday that the central bank could afford to be patient on monetary policy, and downplayed suggestions that interest rates would be hiked twice more in 2019.
Fed Vice Chairman Richard Clarida echoed his comment on Thursday.
“We can afford to be patient about assessing how to adjust our policy stance,” he said. This is in part because “we begin the year as close to our assigned objectives as we have in a very long time,” he added.
“The weaker dollar and a more dovish Fed are the two most alluring factors for gold,” said Stephen Innes, APAC trading head at OANDA.
“There are concerns for the U.S. economy to slow down, perhaps towards the end of 2019 and into 2020, so the markets are pricing rate cuts,” he added.
The precious metal was also supported by concerns on weakening global growth, after countries including the U.S., China, Switzerland and France all reported weaker-than-expected data this month.
“The current intent is that the Vice Premier Liu He will most likely come and visit us later in the month and I would expect the government shutdown would have no impact,” said Mnuchin.
Beijing and Washington concluded the latest round of trade talks on Wednesday. China’s Commerce Ministry said in a statement that discussions with the U.S. were “extensive and detailed,” and that both sides agreed to continue to keep in close contact./investing.com