LONDON: Gold prices rose to a three-week high on Thursday, after the US Federal Reserve abandoned plans to raise interest rates for the year, while a cut in its US growth forecast exacerbated worries of a global economic slowdown.

Palladium rose to a fresh record high of $1,620.53 an ounce on sustained supply deficit amid increased demand for the autocatalyst metal.

Spot gold gained 0.2 per cent to $1,314.87 per ounce as of 1112 GMT, having earlier touched a peak since February 28 at $1,320.22. US gold futures rose 1pc to $1,314.60.

In addition to bringing its three-year drive to tighten monetary policy to an abrupt end, the Fed also downgraded the US growth, unemployment and inflation forecasts, fuelling concerns about an economic slowdown.

“Markets had been expecting the Fed to be dovish but not to this extent,” said Hussein Sayed, chief market strategist at FXTM.

Among other precious metals, spot palladium rose 0.1pc to $1,604.30 per ounce, after touching an all-time high of $1,620.53 earlier in the session. Silver, meanwhile, gained about 0.7pc to $15.56 an ounce.

Published in Dawn, March 22nd, 2019