Gold on Wednesday were under some selling pressure amid a modest pullback in equities, but some experts forecast a recovery for bullion prices as questions about the state of the economy and lofty stock-market valuations persist.
Commodity investors may gather more insights about the outlook for both after the Federal Reserve releases its account of its March policy meeting at 2 p.m. Eastern Time, about a half-hour after gold settles.
Market participants are looking for clues about the Fed’s view on inflation and the possibility that the central bank could soon reduce its market-stimulative bond-buying program as a first step toward normalizing monetary policy.
In the past five days, gold prices have recovered some ground after seeing a 12-month low in early March.
“Trader and investor attitudes remain very upbeat at mid-week, which is a negative for the safe-haven metals,” wrote Jim Wyckoff, senior analyst at Kitco.com.
“ However, losses in gold and silver will likely be limited in the near term as both metals’ near-term technical postures have improved recently,” he said.
on Comex was trading off $6.20, or 0.4%, at $1,736.80 an ounce on Comex after gaining 0.8% on Tuesday, notching a fourth straight gain and matching its longest string of advances since a similar stretch ended Feb. 10, FactSet data show.
Some commodity experts believe that gold’s moves may be limited if investors doubt that equity markets will continue to run to records.
“Market players believe that a large part of good news is already built into the equity market, and now perhaps could be the time for investors to take some breather,” writes Naeem Aslam, chief market analyst at AvaTrade in a note. “Concerns around inflation are real, and they are further fueling the momentum in the gold price, the analyst said.