Powell dismisses gold’s rally above $5,300, says Fed is not losing credibility
Powell made the comments after the Federal Reserve decided to leave the federal funds rate in a range between 3.50% and 3.75% following its first monetary policy meeting of the year. The decision was in line with economists' expectations. According to the CME FedWatch Tool, markets don’t see the next rate cut until June.
While Powell has been fairly quick to dismiss the precious metals’ historic rally, the same can be said for the gold market, which has largely ignored Powell's comments as he walked a fairly neutral line.
He said that both upside risks to inflation and downside risks to the labor market have eased.
“We think we are well-positioned here to watch how the economy unfolds,” he said.
At the same time, Powell also kept the door open for a potential rate hike.$BTC
The entire world has been captivated by gold’s and silver’s surging momentum as prices hit record high after record high; however, the Federal Reserve Chair is not very impressed with the precious metals’ accomplishments.
Many analysts have attributed gold’s and silver’s unprecedented start to the new year, in part, to growing uncertainty surrounding the Federal Reserve’s political independence; however, during his monetary policy press conference, Powell dismissed those concerns.
“The argument can be made that we are losing credibility, but that simply is not the case. If you look at wherein flation expectations are, our credibility is right where it needs to be,” he said. “We don't get spun up over particular asset change prices, although we do monitor them, of course.”
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