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Institutions: Market Beginning to View Gold as a Hedge Against Fed 'Policy Mistakes'
Summary: According to a report from MarketPulse, analyst Christian Norman stated that the stronger-than-expected US September non-farm payroll data reinforces the Fed's inclination to delay rate cuts. However, a core question in the market now is: how can the Fed ensure correct decisions without sufficient data? Despite the high interest rate environment typically being bearish for ...
According to a report from MarketPulse, analyst Christian Norman stated that the stronger-than-expected US September non-farm payroll data reinforces the Fed's inclination to delay rate cuts. However, a core question in the market now is: how can the Fed ensure correct decisions without sufficient data? Despite the high interest rate environment typically being bearish for gold, there are signs that the market is beginning to view gold as a hedge against 'policy mistakes'. If the Fed decides to hold rates steady in December but subsequent data reveals that not cutting rates was a mistake, it could shake market confidence in the dollar. In contrast, gold has become a more reliable 'safe haven'. While this is currently a secondary logic, it could indeed provide some support for gold prices, as it reflects a decreasing confidence in the Fed's ability to accurately navigate the economy without complete information.
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Link: Institutions: Market Beginning to View Gold as a Hedge Against Fed 'Policy Mistakes' [Copy]
