On Wednesday, as the second day Federal Reserve (Fed) meeting approached, gold spot and future prices dropped amid interest rates.
Gold futures for December delivery declined by 0.09% to $1,951.85 per ounce. While the spot gold dipped to 0.02% by $1,931.10 an ounce in a September 20’s Asian morning session.
Although the yellow metal started the week strong amid the Fed inflation rate decision. However, as seen to the data, the meeting is slightly affecting bullion’s performance.
Furthermore, bullion had a mini run for the past couple week sessions. Nonetheless, analysts outlook as the Fed increase rate, the slight gains of gold decline.
On the other hand, experts foresee that yellow metal traders are on a standby mode. The Fed’s rate decision is crucial as it will be the basis whether gold will continue or break its momentum.
Hence, if the Fed decision’s done increasing rates, it might be a win for the bullion to continue its reign.
Meanwhile, the European Central Bank (ECB) raised rates on Thursday to a record high of 4.00%. Still, gold continues to gain and remain stable at $1900.00 peak on its last week’s run.
The central bank’s decision on rate increases signaled that the spike will be its last. Since March 2022, the interest rates surged for 11-consecutive meetings and experts expect the Fed to hold rates this time.
Fed Rates Freeze, Gold will Win
With the interest rate decision that will be released soon, the gold prices are still on edge.
Given the interest spike of the European Central Bank (ECB) last week, bullion looks undented with the increase. However, the Fed decision will roll the yellow metal’s spot on the table.
According to reports, analysts expect the Fed to hold rates by 5.25% from its previous July’s data.
Furthermore, analysts said that regardless of another spike, they expect the Fed to maintain rates over 20-year high until mid-2024.
As the yellow metal declined on Wednesday, silver futures expiring in December eased by 0.11% to $23.34 per silver contract.
Meanwhile, US’s consumer price index topped the 3.60% forecast to 3.70% and increased 0.50% to its 3.20 previews report.
