Gold price soars on renewed banking fears after Fed Chair Powell fails to calm markets – by Anna Golubova (Kitco News – May 4, 2023)

(Kitco News) The gold market rallied as banking sector turbulence intensified despite Federal Reserve Chair Jerome Powell’s attempt to calm the markets. Comex gold hit new record highs of $2,085.40 overnight, with June Comex gold futures last trading at $2,062.70, up 1.26% on the day.

Banking fears escalated Thursday on contagion risk within the U.S. regional bank space. PacWest Bancorp, a regional bank, was reportedly looking at various strategic options, including a sale. Following the news, the bank’s shares tumbled more than 41% Thursday.

The stock of Western Alliance also plunged 39% after FT reported that it was considering a potential sale of all or part of its business. The Arizona-based bank denied the report, describing it as “categorically false in all respects” and noting that “Western Alliance is not exploring a sale, nor has it hired an advisor to explore strategic options.”

Other regional bank shares saw a steep selloff as well, with the SPDR S&P Regional Bank ETF down nearly 9% on the day.

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