The Fed’s policy decision fails to provide a timetable for asset reduction

Gina Lee

Investing.com-Gold rose to its highest level in more than a week in early Asian trading on Thursday. The Fed did not provide a timetable for its reduction plan, adding that it “is still a long way from considering raising interest rates.”

As of 12:16 AM Eastern Time (4:16 AM GMT), it had risen 0.81% to US$1,814.20, after hitting the highest level since July 20 of US$1,817.35. Generally contrary to the trend of gold, after hitting a two-week low in the previous trading day, it fell slightly on Thursday.

The Federal Reserve announced its decision on Wednesday, and the asset reduction made it the agenda of the previous two-day Federal Open Market Committee meeting.

However, Fed Chairman Jerome Powell warned that there are still “some reasons to make up for” in the US job market before the Fed starts to reduce assets, although he did not give a specific timetable. He also downplayed the risks posed by the continued spread of COVID-19 and its global Delta variant to the U.S. economic recovery.

In the Asia-Pacific region, it is expected to postpone its asset reduction plan when its policy decision is announced next week. RBA plans to begin asset reduction in September and review it a few months later. The central bank’s postponement was carried out four weeks after the Bank of Australia’s last policy decision announced the plan. It is expected that the prolonged blockade in Sydney will have an impact on economic recovery.

With regard to COVID-19, the Centers for Disease Control and Prevention said on Wednesday that the transmission rate of COVID-19 in 66.6% of the U.S. counties is high enough to ensure the restoration of indoor sheltering policies.

In other precious metals, silver rose 0.9%, palladium rose 0.6%, and platinum rose 0.8%.