(Bloomberg) — Gold extended losses — after falling the most in two months — as a more hawkish-than-expected Federal Reserve underscored the central bank’s aggressive approach to tackling inflation.

Bullion edged lower on Thursday in Asia after plunging 1.5% in the previous session as Fed Chair Jerome Powell didn’t rule out raising interest rates at every meeting to rein in the quickest inflation in a generation.

See More: Powell Backs March Liftoff, Won’t Rule Out Hike Every Meeting

The tumble wiped out gold’s gains so far this year that were driven by investor bets for a continuation in negative real rates even with rate hikes expected. Although the hawkish pivot has questioned that narrative, bullion could still be a good hedge against inflation as well rising geopolitical risk including an invasion by Russia.

Goldman Sachs Group Inc (NYSE:). The 12-month outlook on gold was raised to $2,150 per ounce, from $2,000, following Powell’s comments about slower U.S. economic growth and a recovery in emerging markets, which exclude China, as well as faster inflation.

“This combination of slower growth and higher inflation should generate investment demand for gold, which we consider to be a defensive inflation hedge,” analysts including Mikhail Sprogis said in a note on Thursday.

Following a drop of 0.4%, $1,815.41 per ounce dropped 0.2% to $1.815.41 in Singapore at 10:30 a.m. Following a 0.5% increase on Wednesday, the Bloomberg Dollar Spot Index climbed 0.1%. The prices of silver, platinum, and palladium dropped all.

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