Market insights and analysis

How dynamic, risk-managed investment solutions are performing in the current market environment

1st Quarter | 2022

Market insights and analysis

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Updates on how dynamic, risk-managed investment solutions are performing in the current market environment.

Last week, gold prices consolidated around their 50-day and 200-day moving averages, bounced off support at $1,760 per ounce, and then closed the week at $1,783.90 per ounce.

“In a clear sign that the Federal Reserve is shifting to tighter monetary policy, Jerome Powell—who’s spent months arguing that the pandemic surge in inflation was largely due to transitory forces—told Congress on Tuesday that it’s ‘probably a good time to retire that word,’” reports Bloomberg. “The Fed chair, tapped last week for another four-year term, still thinks inflation will ebb next year. But in testimony before the Senate Banking Committee, he acknowledged that it’s proving more powerful and persistent than expected, and said the Fed will consider ending its asset purchases earlier than planned.”

What did the Federal Reserve do after admitting it had underestimated the strength of inflation all year? Raise interest rates? No. Stop pumping dollars into the economy by ending asset purchases? Maybe. Protecting the U.S. dollar doesn’t seem to be at the top of the Fed’s agenda.

Now may be a good time to hedge your portfolio with gold.

Rick Andrews is president of Avant Capital Management.



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