Gold edges higher after Fed signals pause in rate hikes
March 23 (Reuters) -Gold prices edged higher on Thursday after the U.S. Federal Reserve raised interest rates by an expected 25 basis points and signalled it was on the verge of pausing future hikes in view of recent turmoil in the financial sector.
FUNDAMENTALS
* Spot gold XAU= was up 0.2% at $1,972.72 per ounce, as of 0101 GMT. U.S. gold futures GCv1 gained 1.3% to $1,974.60.
* Gold prices jumped 2% on Wednesday after the Fed raised interest rates, but indicated it might pause further increases in borrowing costs after the recent collapse of two U.S. banks.
* Fed policymakers believe beating back inflation may require just one more interest-rate hike this year, but less easing next year than most thought would be appropriate just three months ago.
* Gold is traditionally considered a hedge against inflation, and a low interest-rate environment makes non-yielding bullion a more attractive bet.
* U.S. Treasury Secretary Janet Yellen told lawmakers on Wednesday that she has not considered or discussed "blanket insurance" to U.S. banking deposits without approval by Congress as a way to stem turmoil caused by two major bank failures this month.
* Fed Chair Jerome Powell said on Wednesday banking industry stress could trigger a credit crunch with "significant" implications for an economy that U.S. central bank officials projected will slow even more this year than previously thought.
* The dollar index .DXY eased 0.1%, making bullion less expensive for buyers holding other currencies. U.S. Treasury yields fell. USD/ US/
* Spot silver XAG= rose 0.2% to $23.06 per ounce, platinum XPT= added 0.8% at $986.19, while palladium XPD= fell 0.2% to $1,447.21.
DATA/EVENTS (GMT)
1200 UK BOE Bank Rate March
1230 US Initial Jobless Clm Weekly
1400 US New Home Sales-Units Feb
1500 EU Consumer Confid, Flash March
Reporting by Kavya Guduru in Bengaluru; Editing by Sherry Jacob-Phillips
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