Gold prices fell after the Federal Reserve raised interest rates by 75 basis points, as expected. Spot gold was up 0.06% at $1,662.10 per ounce while silver was up 0.50% at $19.41. Platinum was trading at $907.25 down 1.62%, while palladium was trading at $2,122.13 down 2.11%.

The Fed said it estimates ongoing rate hikes are appropriate, while the median Fed forecast shows rates at 4.6% in 2023. Gold has slipped more than 8% this year.

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“A portion of the reason (for gold’s gains) were some comments by Russian President Putin in regards to escalating the conflict in Ukraine. That’s clearly a supportive factor,” said David Meger, director of metals trading at High Ridge Futures.

Putin on Wednesday called up 300,000 reservists to escalate the war in Ukraine and said Moscow would respond with the might of all its vast arsenal if the West pursued its “nuclear blackmail”.

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“In recent months gold had tended not to see much if any, safe-haven demand on global concerns. Precious metals traders apparently reckon Putin’s threats are a big deal,” Jim Wyckoff, senior analyst at Kitco Metals, said in a note.

However, the bullion faced headwinds from the dollar which rose to a new two-decade high, making gold more expensive for overseas buyers, with elevated Treasury yields adding further pressure.

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Fed Chair Jerome Powell said Wednesday his views haven’t changed since his market-jolting speech from Jackson Hole a month ago.

“My main message has not changed since Jackson Hole,” Powell said. “The FOMC is strongly resolved to bring inflation down to 2%, and we will keep at it until the job is done,” he said.

He said that so far there’s only modest evidence that the labor market is cooling off, citing a slight decline in job openings, that quits are off their all-time highs and that payroll gains have moderated but only by a little bit.

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The central bank will need to bring the funds rate to a “restrictive level” and keep it there “for some time.” To do that, it’ll be looking for three things: a continuation of growth running below trend, movements in the labor market showing a return to a better balance between supply and demand, and “clear evidence” that inflation is moving back down to 2%.