K:CC - Gold extends losses after Powell raises potential for more rate hikes

2023-03-07 11:37:51 ET

Gold futures tumbled Tuesday after Federal Reserve Chair Jerome Powell said " inflationary pressures are running higher than expected " and left the door open to more interest rate hikes than previously planned.

April Comex gold ( XAUUSD:CUR ) -1.7% to $1,822.50/oz, and May Comex silver ( XAGUSD:CUR ) -4.1% to $20.27/oz.

ETFs: ( NYSEARCA: GLD ), ( NYSEARCA: GDX ), ( GDXJ ), ( IAU ), ( NUGT ), ( PHYS ), ( NYSEARCA: SLV ), ( PSLV ), ( SIVR ), ( SIL ), ( SILJ ), ( SLVP )

Shares of major gold miners are headed lower, including Newmont ( NEM ) -3.2% , Barrick Gold ( GOLD ) -2.8% , Kinross Gold ( KGC ) -3.5% , Agnico Eagle Mines ( AEM ) -3% , Franco Nevada ( FNV ) -3.7% , Eldorado Gold ( EGO ) -3% , Iamgold ( IAG ) -4.8% , Gold Fields ( GFI ) -2.9% , Harmony Gold ( HMY ) -3.8% .

Gold is "heading lower based on the distinct possibility of increasing the pace of future interest rate hikes, sharper and longer," Wolfpack Capital chief investment officer Jeff Wright told MarketWatch , adding the possibility of a 50 basis point increase for March is now much higher than before.

Hawkish testimony from Powell could wipe out any bullish momentum in gold, and prices might shift back to $1,780-$1,800, according to Oanda's Craig Erlam.

Gold prices edged higher last week after hitting YTD lows in the previous week .

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