Gold price is trading at its lowest level since early January below $1,850. Recent repricing of market expectations around the Fed tightening could create a short-term headwind for the yellow metal, strategists at ANZ Bank report.

Central banks purchases to remain resilient this year

“We expect Gold to experience short-term volatility as the market’s rates expectations diverge from the Fed’s outlook. Unemployment is historically low, and inflation is persisting above the Fed’s target range. This could keep the Fed hawkish.”

“The market for physical Gold is softening as demand in India and China remains lacklustre. Central bank buying should remain strong

but could retreat from record-high levels. Therefore, investment demand needs to be strong to clear the market this year.”

“We are not changing our 12-month price target of $1,900.”