If you have decided to buy gold bullion or to buy silver coins in the last few months then you may have been delighted with how last night’s Fed press conference went.

If you’re still wondering if or how to invest in gold then it might be worth paying attention to what central banks are doing in the coming weeks. After all, how do central banks make their decisions when it comes to monetary policy? In years before it might have been quite straightforward to answer that question – they look at inflation rates, they look at market indicators, they look at data from statistical agencies and then they decide what to do with interest rates.

But, yesterday US Fed Chair Jerome Powell seemed intent on adding some cloak and dagger to the situation and in doing so he just made it look like the Fed are not really sure what they think or where to go now. Of course, there’s nothing gold and silver prices love more than an incompetent central banker but especially one that basically admits that they aren’t sure they’ve got any of this right in the first place.

The Federal Reserve raised the fed funds rate by the expected .75% at their two-day meeting that ended on July 27, the statement was much as expected. The opening of the statement acknowledges that economic indicators for spending and production have softened. But still, the unemployment rate remains very low while inflation remains very high. 

However, the message in the press conference message was very muddled.

The longer Chair Powell spoke during the press conference the more gold and silver rallied on his ambiguous message.

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Chair Powell said that they won’t provide guidance for more than one meeting at a time. They have no idea what the rates will be next year. He added that even in the best of times the projection of rates is uncertain, but projections today are even more unreliable since these are extraordinary times.

When asked by reporters to clarify on the outlook Chair Powell kept referring to the Summary of Economic Projections that was released with the June Federal Reserve statement which points to the Fed Funds rate at 3.4% by year-end. But then he repeated that economic activity has come in weaker than anticipated; which should mean June projections are too stale now.

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