XAU/USD rises 1% to $4,530 after Fed minutes reveal majority support for potential policy tightening amid persistent inflation.
Gold prices climbed during Wednesday’s session, with XAU/USD trading at $4,530, up 1%, after Federal Reserve minutes indicated most officials backed laying groundwork for a rate hike. The move followed a decline in U.S. Treasury yields, which offset the hawkish tone of the minutes.
The April meeting minutes showed policymakers agreed further tightening could be needed if inflation remains above the 2% target. Several participants also favored removing language suggesting an easing bias in future statements. This marks the second consecutive meeting where officials hinted at possible rate increases.
Despite a 50% chance of a December rate hike priced into money markets, the U.S. Dollar Index (DXY) fell 0.19% to 99.11, supporting gold’s rally. The Fed also noted Middle East conflict as a risk to the economic outlook.