• Gold price seesaws in a $10 range after the Federal Reserve hiked rates by 25 bps.
• Federal Reserve officials stated that more increases would be appropriate.
• US central bank policymakers decided that future rate hikes would be in 25 bps increments.

Gold price rises following the US Federal Reserve (Fed) decision to slow the pace of interest rate increases and lifted the Federal Funds rate (FFR) by 25 bps to the 4.50% – 4.75% area. At the time of writing, the XAU/USD is trading volatile but above its opening price, at around the $1920-$1930 range.

Summary of the monetary policy statement

In its monetary policy statement,  Fed officials voted unanimously to raise rates by 25 bps, emphasizing that additional rate hikes would be appropriate, pushing against the financial market’s expectations for a Fed pivot.

Policymakers acknowledged that inflation has “eased somewhat but remains elevated.” The Fed added that indicators point to modest growth in spending and production and commented that the labor market remains robust. Officials added, “in determining the extent of future rate hikes, it will take into account cumulative tightening, policy lags and economic and financial developments.”

Fed officials commented that future rate hikes would be in 25 bps increments, dropping the reference to the “pace” of additional rate hikes.

Now that the Fed’s decision is in the rearview mirror, traders prepare for the Federal Reserve Chair Jerome Powell’s press conference at around 19:30 GMT.