Gold slides but still near its four-month high after fed speech

Gold slid on Tuesday trade in Asia, but it still hovered near its four-month high following the Federal Reserve’s statement about inflation concerns.

Gold futures lowered 0.23% to $1,880.15 by 12:08 AM ET.

The dollar, which usually moves inversely to gold, was also on the losing end, falling to a four-month low on Tuesday. U.S. Treasury yields also tumbled to two-week lows.

Fed officials said a surge in prices, due to bottlenecks and supply shortages as the number of COVID-19 cases continue to fall would not be surprising. However, the officials also emphasized that any price gains are likely to be short-lived.

Meanwhile, the U.S. will release its Personal Consumption Expenditure (PCE) Prices index, the Fed’s preferred method of measuring inflation, on Friday.

Despite the decline, investors’ outlook on gold remained positive, with the safe-haven close to erasing its decline for 2021 to date.

In other precious metals, palladium gained 0.5%. Silver declined 0.6% and platinum lost 0.2%.