Gold down as market waits for Fed to opine on interest rates
New York (Oct 29) Gold was trading lower mid afternoon as the world waited for US Federal Reserve to opine on interest rates.
The end to America’s multi-trillion dollar fiscal stimulus programme will usher in a new period of monetary policy; whether this includes a further, prolonged period of cheap money remains to be seen.
To date the Fed has been unwilling to hike the cost of borrowing amid against a backdrop of muted inflation and amid worries over the quality and longevity of the US economic recovery.
While the past two years have been difficult for those invested in the precious, overall it metal has benefited in this low interest rate environment since 2008.
At 3.30pm, an ounce of gold was changing hands for U$1,224 and ounce, down U$4.50.
“While equity markets seem content to rally ahead of news from the Federal Reserve meeting, commodities are certainly less keen on moving too far in either direction,” said Chris Beauchamp, analyst at spread-betting firm IG.
“Gold fans might get a slight lift from a Federal Open Markets Committee decision but overall any move higher in this area will be short-lived.”