• Powell says the Fed is prepared to increase the pace of rate hikes if needed.
• US Dollar jumps amid growing expectations of a larger rate hike from the Fed.
• XAU/USD to remain under pressure while under $1,820/oz.

Gold price accelerated to the downside following the release of Fed Chair Powell's remarks. XAU/USD bottomed at $1,815, the lowest level in a week. It is falling almost $30 on Tuesday, the worst day in a month.

US Dollar jumps on Powell

Federal Reserve Chairman Jerome Powell mentioned in prepared remarks that strong economic data will likely lead to higher interest rates than previously thought, in order to curb inflation.

The speech was seen as hawkish by market participants. The odds of a 50 basis points rate hike jumped. According to interest-rate futures tracked by CME Group, market-implied probabilities of a 50 bps increase at the March FOMC meeting rose from nearly 30% to 50%.

Jerome Powell Live: Fed Chair delivers hawkish testimony in US Senate

US Treasury bonds collapsed. The US 10-year yield rose from nearly 3.94% to above 4% and then pulled back; the 2-year yield hit at 4.97%, the highest level since 2008.

Gold prices extended the decline even as US yields moved off lows, affected by a stronger US Dollar and risk aversion. Silver is losing 4%, trading at $20.19, the lowest level in four months.

Technical levels