Precious Metals Decline on Fed Stance

Gold and silver prices slipped after the US Federal Reserve decided to keep interest rates unchanged, increasing the opportunity cost of holding non-yielding assets. Silver extended its losses for a second day, trading below $53.50, as market participants turned their attention toward upcoming US PCE inflation data for further monetary policy clues.

US Dollar Strengthens Post-Fed

The US Dollar Index recovered from its previous day's losses, trading above the 102.00 mark following the Fed's decision. The greenback's renewed strength put pressure on major currencies, including the British Pound, the Euro, and the Japanese Yen, with traders remaining cautious ahead of key US economic data releases.

Divergent Moves from Global Central Banks

Central banks globally demonstrated varied policy approaches, impacting their respective currencies. The Bank of Canada delivered a rate hike which strengthened the Canadian Dollar, while high inflation data in Australia increased expectations for a rate increase from the Reserve Bank of Australia. In contrast, the Reserve Bank of New Zealand held its policy rate steady, causing the NZD to fall.

Oil Markets React to Middle East Tensions

Crude oil prices experienced volatility as traders assessed geopolitical developments in the Middle East. Initial price support came from concerns over potential supply disruptions in the region, though prices later eased as markets weighed the possibility of diplomatic progress against the risks of a wider conflict.