For gold, traditionally seen as an inflation hedge, higher interest rates could increase the opportunity cost of holding the metal, potentially dampening its appeal. This perspective aligns with recent comments from Fed Chair Jerome Powell and other officials, who have expressed uncertainty about the adequacy of current rates in combating inflation. Meanwhile, Moody’s recent downgrade of the U.S. credit outlook adds to the complex economic backdrop although the current price action suggests investors are treating it as a non-event.