Gold Prices Surge as Fed Hike Bets Fall, Bullion Seeks Path to $4,500
Gold prices rebounded on Thursday as investors reduced bets on an immediate rate hike after the Federal Reserve kept interest rates unchanged. The Fed's decision, a 9-3 vote to keep the target range at 3.5% to 3.75%, was seen as less hawkish than expected, with three policymakers favouring a quarter-point increase.
Gold rose 0.3% to $4,076.29 an ounce by 0245 GMT after climbing as much as 2% on Wednesday. CME FedWatch pricing showed the probability of a September rate hike had fallen to about 63% from roughly 81% before the decision.
The World Gold Council sees gold potentially reaching $4,500 if weaker growth, renewed geopolitical stress or lower rate expectations materialize. However, TD Securities analysts believe bullion could drift towards $3,900 if the energy shock keeps rate expectations elevated.