In his speech on Aug. 27, U.S. Federal Reserve chairman Jerome Powell said that the central bank will allow inflation to stay above its 2% target level if the figure has been languishing below that level for a long time. Some analysts believe that this could mean no rate hikes for at least five years.
In response to the speech, the U.S. (DXY) resumed its downtrend while gold is trading in the black. This shows that traders believe that the central bank’s change in strategy could debase the dollar further, hence, the demand for gold as a store of value remains intact.
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