Gold Price Slumps as Hawkish Fed Hints at Further Rate Hikes

The gold price is facing fresh sellers above $4,300 after stalling its recovery from six-week lows of $4,235 reached soon after hawkish US Federal Reserve (Fed) monetary policy announcements.

The Fed raised interest rates by 25 basis points to 3.75%-4% in a unanimous decision on Wednesday, with the Dot Plot suggesting another rate hike this year and keeping rates flat through 2027 for some officials.

Fed Chair Kevin Warsh emphasized that 'the action will support a timelier return to its 2% inflation goal,' hinting that the disinflation path remains intact.

The gold price rebound appears to be a dead cat bounce as markets reprice a more hawkish Fed alongside other major central banks, acting as a headwind to the non-yielding bullion.