Fed's Hawkish Hold Leaves Gold and Silver Markets in Limbo Until September

The Federal Reserve's decision to hold interest rates steady has given gold and silver a boost, but experts warn that markets are likely in limbo until September.

Jesse Colombo, an independent precious metals analyst, said that while higher interest rate expectations typically put downward pressure on precious metals, they have held up surprisingly well. This resilience suggests that pessimism may be priced in excessively, and Colombo believes gold and silver are now set up for a potential rebound.

The technicals suggest that gold broke out of a triangle pattern last week, which could indicate a move upwards. However, the breakout remains valid, but there has not yet been much upside follow-through. Colombo wants to see gold push decisively above $4,100 as further confirmation of strength and the triangle breakout.

Natixis economists agree that this Fed meeting was a hawkish hold, but argue that it will only serve to push out market pricing for the Fed until after the summer. They note that apart from a slight change in language, the official statement was unchanged from June. The net result is that July's uncertainty has merely been pushed out to September.