Quotation, latest news and infos about gold : it had not happened for 10 years ! Fed interest rate rises. The trend in the gold spot price remains downward.

 

On the chart below, displaying the price of one ounce of gold in euros (XAUEUR), we can see the market reaction to the announcement of higher interest rates.

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Briefly.

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It was the decision the most anticipated this year in United States : the Fed adjusted the interest rates and tightening the country’s monetary policy. But the message accompanying the decision was more important : the US economy is in good shape (+ 1.5% yesterday on the S & P).

Rising interest rates should be phased in 4 times during 2016.

 

Read also : which factor drives gold price ?

 

Impact on US dollars (graph on the right) : at the historical level, the US dollar in the years 1994, 1999 and 2004 dropped when the Fed began to tighten policy. The index has gained 9% this year, 2015.

A strong dollar might not bode well for commodities, most of which are denominated in the US currency, which makes it more expensive for buyers materials. The Bloomberg Commodity Index fell to a lower today (1,999).

 

 

Which forecast for gold price after interest rates hike ?

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Detailed article : what can we forecast for gold spot price in 2016 ?

 

But gold could been an exception! Although the precious metal less attractive during tightening cycles rate it pays no dividend interest such as stocks and bonds. Some analysts predict a rise in the quotation of gold in 2016, up to $ 1,200 per ounce (12% more).
the price of gold has fallen in recent days to $ 1,053 an ounce, its lowest in 6 years.

 

 

Source : Bloomberg.

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