Fed Shock in the Gold Market and Diverging Expert Views
While spot gold fell sharply after its record high, experts are divided among expectations of rise, fall, and sideways movement ahead of the new week.
After reaching $4,697 in global markets, spot gold dropped to $4,445 following hawkish messages from Fed Chair Kevin Warsh and a wave of selling. According to the Kitco News survey, analysts are split, while retail investors predict that the upward trend will continue.
Record and Decline Process in Spot Gold
In the early days of the week, spot gold climbed to $4,697 amid a weakening dollar and concerns over U.S. debt.
In the domestic market, gram gold broke a record at 7,123 TL, while spot gold fell to $4,445 with a wave of selling in the second half of the week.
Impact of Fed Statements
The main factor disrupting the upward trend was the messages coming from the Fed front.
Following strong U.S. economic performance and high inflation data, Fed Chair Kevin Warsh made hawkish statements.
Kitco News Survey Results
No consensus was reached in the survey conducted by Kitco News with 21 expert analysts.
While 48 percent of the analysts expect a recovery, some argued that the decline will continue or that prices will follow a sideways course.
Retail Investors' Expectations
On the retail investor side, a clear optimism prevails.
In the survey involving 207 participants, 59 percent of small investors predicted that gold would rise.
Market Experts' Assessments
Marc Chandler, Managing Director at Bannockburn Global Forex, stated that the first critical support for spot gold is at $4,440.
Senior Market Strategist James Stanley stated that the recent decline is a healthy correction.