Breaking: Gold tumbles under $1,800 in the wake of the hawkish Fed decision
|XAU/USD has been extending its falls and trades under the round $1,800 mark for the time since early May. This round level served as resistance during April and was broken only in early May. The current fall has sent the precious metal to a 10-week low.
It is essential to note that buyers have come in, and XAU/USD's low is only $1,799.33 at the time of writing.
The main downside driver for gold is the Federal Reserve's hawkish decision on Wednesday. The world's most powerful central bank surprised markets by signaling two rate hikes in 2023 and by indicating that it will soon work on tapering down its bond-buying scheme. The $120 billion/month program has been supporting XAU/USD and its potential reduction is weighing on the metal.
Moreover, returns on 10-year Treasuries have jumped to 1.56%, making yieldless gold less attractive to investors. XAU/USD first dropped in response to the Fed decision and then suffered another downfall on Thursday.
See more about the Fed decision:
Federal Reserve ups the ante on inflation, growth and interest rates
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