Gold prices rise with recovery in global markets
Gold prices recovered in the final days of the week following the Fed's rate hike, with gram gold reaching 6,865.89 TL domestically.
Gold prices made up for the decline recorded following the US Federal Reserve's interest rate hike in the final days of the week. A sharp pullback in oil prices and the depreciation of the US dollar provided support to the precious metal, while gram gold domestically rose to 6,865.89 TL.
Global Markets and Spot Gold
At the weekly close, spot gold increased by 0.9 percent to $4,379.59 per ounce, while gold futures reached the $4,417.84 level with a 0.4 percent premium. On a weekly basis, spot gold gained 0.8 percent and futures contracts gained 0.2 percent.
Fed Decision and Bond Yield Impact
At the Federal Open Market Committee meeting, the policy rate was increased by 25 basis points to the 3.75-4.00 percent range. Statements by Fed Chair Kevin Warsh and updated projections caused the ounce price to drop to a six-week low on Wednesday.
During the same period, the US 10-year Treasury yield increased by 5.5 basis points to 5.002 percent, reaching its highest levels in 19 years.
Inflation Expectations and Forecasts
The central bank's current projections indicated that the return of monitored inflation indicators to the long-term 2 percent target might extend until 2029. Another rate hike is expected in December.
Pullback in Oil Prices
The partial commissioning of pipeline capacity, the provision of additional oil, and expectations regarding diplomatic contacts alleviated supply concerns. This drop in oil prices reduced the pressure on gold.
Domestic Gold Prices
An increase was also observed in domestic gold prices in the free market. According to closing data, gram gold was traded at 6,865.89 TL, quarter gold at 11,215.00 TL, and Republic gold at 44,700.00 TL.