Gold recovers on divided Fed

18 August, 2016

Gold recovers on divided Fed

In today’s session the gold price initially traded lower before the FOMC minutes from the US Federal Reserve but the recovered some of its losses as it became clear that the Fed policy makers were split on deciding further interest rate hikes.

Most players in the market today expected a hawkish tone from the US central bank which would have set the stage to lift interest rates next month which initially put pressure on the gold price but as the speech unfolded it became clear that a rate rise was far from certain.

“While the minutes appear more hawkish than the official statement, there have been a selection of disappointing data releases since the time of the meeting, employment notwithstanding. As a result, there has been evidence for both sides to point to, which has resulted in recent speeches by FOMC members containing a wide range of views of the appropriate course of policy,” said Royce Mendes, senior economist at CIBC World Markets

Some analysts say that with a movement in September now in doubt there may not even be a rate hike until next year as the fed would be cautious to tighten monetary policy in November or December around the time of the US presidential election.

A bullish minutes would have strengthened the US dollar making the currency more attractive which is not good news for gold which tends to move in the other direction.


Source link  
Stagflation a threat to US dollar

The US dollar jumped suddenly after yesterday’s release of better than expected inflation data and then suddenly reversed into negative territory which...

Gold made a run for the $1365 mark

If we look at the arrow on the weekly gold price chart we can see that a resistance point that was first encountered in around august of last year...

Gold awaits direction of Stockmarket

The gold price has remained in a tight range over the last 3 trading sessions as equity markets in the US continue to swing wildly and are now down...


US dollar in for a tough year

The US dollar finished off 2017 mostly weaker against the major currencies despite 3 rate hikes from the US Federal Reserve and although...

RBA misleads investors on AUD

The Australian dollar has dropped sharply in today's Asian trading session on the back of disappointing data and throws into question yesterday...

Brexit doubts pressure pound

The British pound has enjoyed a good run against its US counterpart ever since rumors spread that the EU and the UK were close to reaching a deal...


Gold steady ahead of key news

The gold price is trading slightly higher today as the market awaits the senate testimony later today from Jeremy Powell who is Donald...

Gold looks to go past $1300

The gold price remains well supported today after yesterday’s stellar gains on the back of a less than convincing speech from The US Federal Reserve...

Gold remains supported

After falling sharply on Monday, the gold price has stabilized over the last 2 days and it looks as if for now, the precious metal has found strong...

  


Share: