Gold lower on Federal Reserve's resolve to keep rates elevated through 2023
Gold began the trading week moving lower as market participants continue to digest and react to last week's FOMC statement and economic projections. In essence, the Federal Reserve made it clear that they are committed to reducing inflationary pressures by continuing to implement rate hikes and then maintaining those elevated rates throughout the next year.
"The message from last week's policy-making meeting was almost entirely hawkish. The Fed's statement retained the language of"ongoing increases," suggesting several more interest-rate hikes. Officials projected a higher-than-expected peak rate of at least 5% to 5.25% , higher inflation for longer, lower output growth and higher unemployment."
In his article today he addressed that the Federal Reserve can't seem to impact or break the market's relative optimism about the outlook for interest rates. He suggested that this is a false narrative that could spell trouble ahead for investors and consumers. His opinion is that the market participants' narrative which doubts the Federal Reserve's resolve is wrong, suggesting that this optimism has a shortcoming that could blindside the American public and make the Federal Reserve even more hawkish.
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