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Fed-induced market volatility could spur demand for gold: Experts

Use current correction to build a 10-15% allocation to yellow metal

Gold
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At the start of the year, gold had rallied to above $2,100 per ounce in the international market due to the outbreak of the Russia-Ukraine war. Photo: Bloomberg

Bindisha Sarang
Gold has declined 4.8 per cent over the past month. Higher-than-expected consumer inflation data in the United States has led to expectations of aggressive policy tightening by the Federal Reserve (Fed). That, and the strengthening of the US dollar, has dimmed the yellow metal’s prospects in the near term.

Rising real rates

At the start of the year, gold had rallied to above $2,100 per ounce in the international market due to the outbreak of the Russia-Ukraine war. Megh Mody, commodities and currencies research analyst, Prabhudas Lilladher Pvt Ltd says, “The rally, however, was short-lived as the Fed started interest-rate

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