GOLD HITS NEW ALL-TIME-HIGH AMID CENTRAL BANK POLICY SHIFTS

• Gold's rally propels it to an unprecedented $2,164.78, buoyed by expectations of easing policies from ECB and Fed.
• Despite ECB's hawkish hold, Lagarde's openness to June adjustments contrasts with rising US Treasury yields.
• Powell hints at easing, increasing June rate cut odds amid cooling US labor market signs.

Gold witnessed an extension of the incumbent rally, hitting an all-time high of $2,164.78 and remaining on the path toward $2,200. The US Dollar tumbled across the board as major central banks like the European Central Bank (ECB) and the Federal Reserve (Fed) prepare to ease policy.

On Thursday, the ECB decided to hold rates unchanged and delivered hawkish remarks led by the ECB President Christine Lagarde. Even though she prepared a possible policy adjustment, she disregarded a possible cut by the April meeting, though June looks possible.  Consequently, US Treasury yields rose, sparking a pullback in yellow metal prices.

Across the pond, Fed Chair Jerome Powell appeared at the US Congress and reiterated yesterday’s speech. He said they would adjust borrowing costs and added the Fed was “not far” from being able to ease policy. Although he pushed back against a cut in March, the window is open for June’s meeting. Odds for a quarter of a percent rate cut in that meeting increased.

Yields on US Treasuries tumbled throughout the week with the 10-year benchmark note rate at 4.116%, down six basis points. Besides that, soft US economic data suggests the economy isn’t faring as solidly as expected. Americans filing for unemployment claims rose as expected by 217K, though this suggests the labor market is cooling, a consequence of tighter policies.