Gold rallies to a near 6-week high, but ends below the key $1,900 mark

Gold got a boost Wednesday from the Federal Open Market Committee’s last policy update of 2020, when Fed Chairman Jerome Powell “made it very clear that rates are not rising soon, and they are committed to pushing inflation higher,” said Peter Spina, president and chief executive officer at GoldSeek.com.

The Fed on Wednesday emphasized its intention to keep interest rates pinned near 0% to at least 2023 until the economy fully recovers from the viral pandemic.

“Price inflation is brewing but rates are going to remain suppressed by the Fed, meaning the real yields on [Treasurys] are going to go deeper into negative territory,” Spina told MarketWatch. “The prospects of holding negative yielding debt versus zero yielding gold only grows as the global debt surges to record highs in nominal rate category, over $18 trillion now.”

“Investors now see that gold is a much more appealing store of value” than in the U.S. dollar or fiat currency alternatives, he said.