Daily Gold Market Report

Federal Reserve to End Bank Term Funding Program Amid Exploitation Concerns:
Shifts Focus to Discount Window

(USAGOLD – 1/25/2024) Gold prices are trading higher following the release of recent data indicating that the U.S. economy’s growth surpassed expectations, alongside inflation rates that were lower than anticipated. Gold is trading at $2022.21, up $8.32. Silver is trading at $22.88, up 22 cents. The Federal Reserve Board announced the termination of the Bank Term Funding Program (BTFP) on March 11, following reports of banks exploiting the program for profit. This decision comes amid concerns over the program’s optics and its role in providing banks with essentially free money ($47 billion) over the last two months. The Fed now plans to address future liquidity needs through the discount window as we reported on Tuesday, the same mechanism involved in the 2008 financial crisis. This is shaping up to an interesting end to Q1 of 2024 for the banking system.

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