Tuesday 12 December 2017

Gold falls to lowest since July ahead of Fed meeting

Spot gold fell 0.1 percent to $1,240.64 an ounce by 1:36 p.m. EST (1836 GMT), after hitting its lowest since July 20 at $1,235.92.

Gold prices retreated to a near five-month low on Tuesday as investors braced for a widely expected U.S. interest rate increase this week and looked for clues about further hikes from the Federal Reserve.
pot gold fell 0.1 percent to $1,240.64 an ounce by 1:36 p.m. EST (1836 GMT), after hitting its lowest since July 20 at $1,235.92.
U.S. gold futures for February delivery settled down $5.20, or 0.4 percent, at $1,241.70 per ounce.
Global markets are watching the U.S. central bank's two-day meeting for clues about the Fed's future rate path.


"The rise is already in the price so it's more about the outlook the Fed gives," said ABN Amro commodity strategist Georgette Boele.
Gold is highly sensitive to rising U.S. interest rates as these increase the opportunity cost of holding non-yielding bullion and boost the dollar, in which it is priced.

Higher equity prices and an increased interest in crypto currencies, including bitcoin, have likely stolen the shine from gold lately, causing prices to break below the most recent trading range, said Josh Graves, senior commodities strategist at RJO Futures in Chicago.

Between mid-October and early-December, gold prices had stayed between $1,265 and $1,300 an ounce.


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