Gold rebounded at $1,245.46 an ounce on Wednesday, with support above the 200-day moving average. Market widely expected a 25 bps increase in June and September, and balance sheet tightening in December, ahead of the FOMC meeting in June. Investors now expect that the central bank will cut its balance sheet in September and raise rates again in December after the Federal Reserve raised interest rates in June and said it would begin cutting its holdings of bonds and other securities this year. But the accelerated pace of tightening will hurt economic growth especially amid recent weak inflation data. The S&P 500 slipped for two consecutive days after hitting record highs. Investors shall closely watch the stock market as precious metals will be boosted by sharp losses in equities.
Silver fell at $16.3972 an ounce. It tracked gold this week, trading in a tight range with support at previous key levels. The white metal had lost over 7 percent since June, paring most of gains made in May. On technical front, the momentum column of the MACD index showed a relatively bearish tone, but with the downward momentum shrinking. On trading strategy, investors may continue to stay on the sidelines.

 
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