Steady After Yesterday’s Post-FOMC Rally

Gold is little changed in the Asia-Pac session, after closing 1.5% higher at $2319.56 on Wednesday.

• Wednesday’s move came after Fed Chair Powell and the FOMC delivered a less hawkish message than feared.
• The key addition to this statement compared to March’s was "So far this year, the data have not given us that greater confidence. In particular, and as I noted earlier, readings on inflation have come in above expectations. It is likely that gaining such greater confidence will take longer than previously expected."
• And the next sentence, "We are prepared to maintain the current target range for" used to conclude "longer, if appropriate" - now it ends "as long as appropriate".
• While a “Higher for Longer” message was conveyed, the market focused on Powell’s comment that "I think it's unlikely that the next policy rate move will be a hike".
• US treasury yields were down over double digits before profit-taking set in.
• The focus now turns to Friday’s US Non-Farm Payrolls release.
• Overnight, labour market data gave mixed signals. JOLTs data showed further signs of easing labour market pressures. The number of job openings dropped to a three-year low and the quits rate fell to the lowest since August 2020. However, US private payrolls increased more than expected in April while data for the prior month was revised higher.