Gold rose as renewed concerns about the US banking sector fueled speculation that the Fed may soon have to end its cycle of rate hikes.
Market forecasts in the banking sector in the USA are very under After the balance sheets received, the news flow about the plans for the borrowing limit to First Republic Bank suppressed the risk appetite.
While the suppression of risk appetite supported safe-haven purchases, an ounce of gold in the spot market reached over $2,000 again.
Ed Moya, Oanda Senior Market Analyst, said: “The tension in banking seems to be back. “If First Republic is not miraculously bailed out and we don’t see immediate pressure on other midsize banks, the precious metal could rush to record highs.”
On the other hand, concerns about the growing debt ceiling in the US are also clouding the precious metal’s outlook. Time is running out for policymakers to reach an agreement to avoid technical default.