Interest rate futures showed markets were pricing in another rate hike at the Fed’s July 25-26 meeting, with rate cuts seen well into 2024.
Fed Chair Jerome Powell had earlier highlighted the majority view that two additional rate increases would be needed.
Fed Governor Christopher Waller made the case for tighter policy in the central bank leadership’s final remarks before the blackout on public comments ahead of the July meeting.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
Speaking to Bloomberg TV on Monday, Treasury Secretary Janet Yellen said she did not expect the U.S. economy to enter into a recession.
Goldman Sachs’ chief economist, Jan Hatzius, said the bank was cutting its probability that a U.S. recession will start in the next 12 months to 20% from an earlier 25% forecast.
China’s economy grew at a frail pace in the second quarter, raising pressure on policymakers to deliver more stimulus to shore up activity.
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