Gold Prices Remain Flat as Fed Signals Continued Inflation Concerns

Gold Falls as Fed's Divided Vote Suggests Higher Interest Rates Ahead

Gold prices held a three-day loss on Thursday after the Federal Reserve's decision to keep US interest rates steady was accompanied by a hawkish dissent from several policymakers. The precious metal was trading near $4,550 an ounce in early trading, having fallen 3.4% over the previous three sessions.

The Fed's 8-4 vote, which marked the first time since 1992 that four officials dissented against a Federal Open Market Committee decision, revealed a deepening division over the outlook for policy due to the increased uncertainty caused by the war in Iran. The conflict, now in its ninth week, has sent energy prices soaring, with Brent crude closing above $118 a barrel, the highest since June 2022.

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Treasuries slumped, with two-year yields rising the most on a Fed decision day since 2022, as traders boosted bets the central bank may need to raise borrowing costs amid persistent inflation pressures. This would be a headwind for non-yielding bullion, which is set for a second monthly decline in April.

Gold has fallen about 14% since the war began in late February, and the slump has deepened in recent days as progress on US-Iran peace talks has stalled and energy shipments via the Strait of Hormuz remain practically at zero. President Donald Trump signaled the US will persist with a naval blockade of Iranian ports as it tries to choke Tehran's oil exports and force it back to the negotiating table.

Spot gold edged up 0.1% to $4,552.01 an ounce at 7:33 a.m. in Singapore, while silver rose 0.5% to $71.64 an ounce. Platinum and palladium also advanced. The Bloomberg Dollar Spot Index, a gauge of the US currency, was little changed after ending the previous session up 0.4%.